The US Federal Trade Commission (FTC) has started investigations into auto finance companies which require sub-prime borrowers to have so-called GPS starter-interrupter devices enabled on cars which they lease.

These “kill switches” are capable of monitoring a vehicle's constant whereabouts and also have the remote ability to shut a car off and to prevent a car from starting, which makes it easy for lenders to repossess the car for missed payments.

However, there are signs that the FTC is raising safety and privacy concerns about the use of such technology, Bloomberg reports.

Credit Acceptance Corporation (CAC) said in a recent Securities and Exchange Commission filing that it had received a civil investigative demand from the FTC “seeking information on the company’s policies, practices and procedures in allowing car dealers to use GPS starter interrupters on consumer vehicles”.

CAC added: “We are co-operating with the inquiry and cannot predict the eventual scope, duration or outcome at this time.”

In November 2016, the FTC issued a civil investigative demand to Westlake Financial Services also asking for information on the devices, and Bloomberg says it has seen documents suggesting other lenders have also been put in the spotlight. The FTC has made no official comment on the matter.

The regulator is believed to be seeking information on the policies and procedures for communicating with consumers about the devices, how information from the devices is stored and how the lender manages complaints and disputes regarding the technology, which is in use in around two million vehicles across the US.