Dealer Settles with State on Ad Issues Featured
08 November 2016
The Pennsylvania Office of Attorney General has reached a settlement with a Philadelphia used-car dealership, and its owner, alleged to have engaged in deceptive business practices, which included failing to honor coupons that advertised discounts on vehicle purchases.The settlement reached with Haim Shmilovitch, and his business, Eden Vehicle Marketing Inc., was the result of an investigation by the Office of Attorney General's Bureau of Consumer Protection. The business is commonly known as Eden Auto Sales.The settlement calls for eligible consumers to receive restitution of $1,000 each. In order for consumers to be eligible, they must provide adequate documentation that confirms they purchased a vehicle from Eden Auto Sales and presented a coupon that was not applied to the purchase price of the vehicle.Consumers have until Dec. 16 to file a complaint for restitution with the Attorney General's Bureau of Consumer Protection. According to the settlement, reached in the form of an assurance of voluntary compliance, advertisements for various vehicles offered for sale at the dealership included a coupon for "$1,000 to use as cash…" However, the coupons, in very small font, featured the words "up to" to quantify the amount of the coupon. Also listed in small font was the limitation that the coupon "must be presented prior to negotiations," the settlement alleges.Also, it was alleged that, in certain instances, Eden Auto Sales failed to apply a discount, whether it was the full coupon amount or a lesser amount, to the purchase price of the motor vehicles when consumers presented the coupons.Other deceptive business practices alleged in the settlement included the dealership advertising "Rates as Low as 1.9%" without stating that the rate was an annual percentage rate. Eden Auto Sales also allegedly advertised numerous vehicles for sale, with the statement “$0 DOWN,” but failed to include the terms of repayment and the annual percentage rate. It was also alleged that the dealership further stated in certain advertisements that “Dr. Credit has the prescription. Fix Your Credit Here!” without fully disclosing how they would accomplish that representation, according to the settlement.The settlement also required Shmilovitch and Eden Auto Sales to pay the state $2,000 in civil penalties and $2,000 in costs of investigation. The payment of civil penalties will be distributed to the Department of Treasury.