The U.S. Supreme Court has overturned a lower court ruling and ruled that lenders can only be fined up to $1,000 for Truth in Lending Act disclosure violations involving consumer loans and home equity lines of credit.The case revolved the penalty cap from $1,000 to $2,000 for TILA violations involving first and second mortgage loans. A lower court ruled in Nigh v. Koons Buick that Congress removed the $1,000 cap on consumer loans when it raised the cap for mortgage loans to $2,000. The judge went on to award car buyer Bradley Nigh $24,000 in TILA damages -- twice the finance charge on the auto loan. The Supreme Court opinion says a "less-than-meticulous drafting of the 1995 amendment created an ambiguity." But a review of the legislative history provides "scant indication" that Congress intended to remove the $1,000 cap. "It would be passing strange to read the statute to cap recovery in connection with a closed-end, real-property-secured loan at an amount substantially lower than the recovery available when a violation occurs in the context of a personal-property-secured loan or an open-end, real-property secured loan," the Supreme Court said.

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