A Southern California auto dealership group will pay $1.4 million to settle Federal Trade Commission charges that it violated a 2014 administrative order prohibiting it from misrepresenting how much consumers could pay to finance or lease a vehicle.
The proposed court order resolving the FTC’s complaint against 12 businesses operating as the Norm Reeves dealerships, bars similar advertising misrepresentations, and imposes strict compliance and reporting terms to prevent future violations.
According to the FTC’s first complaint, the defendants made a variety of misrepresentations in advertisements to consumers that violated the FTC Act, falsely leading consumers to believe they could buy vehicles for specific low prices, finance vehicles for specific low monthly payments, and/or make no upfront payment when leasing.
Specifically, the FTC charged Norm Reeves with deceptively advertising that consumers could pay $0 up-front to lease a vehicle when, in fact, the advertised price excluded substantial fees and other costs. The ads also allegedly violated the Consumer Leasing Act (CLA) by failing to disclose certain lease related terms. One of the dealerships’ ads also allegedly violated the Truth in Lending Act (TILA) and Regulation Z, by failing to disclose certain credit-related terms.
The orders settling the previous complaint, which the Commission approved as final in May 2014, prohibited the dealerships from misrepresenting the cost of purchasing a vehicle with financing, or any other material fact about the price, sale, financing, or leasing of a vehicle in its ads. The orders also addressed the defendants’ alleged TILA and CLA violations by requiring the dealerships to clearly and conspicuously disclose terms required by these credit and lease laws.
The proposed court order settles the FTC’s civil penalty complaint that the defendants violated the 2014 order by misrepresenting the total cost of vehicle financing or leases to prospective buyers, or misrepresenting the offer’s availability to all consumers. The order also settles Commission charges that the defendants failed to disclose, or did not clearly and conspicuously disclose, credit and lease information required by TILA and the CLA, and failed to maintain proper records, in violation of the order.
The federal Occupational Safety and Health Administration (OSHA) cited Lynnway Auto Auction Inc. for electrical, struck-by, and other hazards at its auto auction facility in Billerica, Mass.
On May 3, OSHA inspected the facility after five people were struck by a sport utility vehicle and died as a result of their injuries. The agency issued 16 citations to the company for motor vehicle hazards, blocked exit routes, violations of the hazard communication standard, and recordkeeping deficiencies.
Lynnway faces proposed penalties totaling $267,081.
OSHA also conducted a joint employer inspection, and determined that temporary workers from TrueBlue Inc. – doing business as PeopleReady – were also exposed to struck-by hazards. The agency cited the Dover, N.H., staffing firm for one serious violation for a struck-by hazard, and proposed a penalty totaling $12,675.
Enterprise Holdings will honor 14 automotive auction partners from across the country with its 2017 Auction Achievement Awards.
This annual program recognizes auto auction partners for exceptional services that support Enterprise Holdings' efforts to remarket late-model, low-mileage, well-maintained rental and fleet vehicles to potential buyers.
Regional Enterprise Holdings teams present the awards to the auction partners in their area, in two categories: whole-car auctions and damaged-vehicle auctions. Recipients are recognized for exceptional performance in the areas of communication, customer service, marketing and reconditioning, operational success, and strategic planning.
The 2017 Auction Achievement Award winners in the whole-car category are:
ADESA Los Angeles (Orange, Calif.)
Manheim Central California (Roseville, Calif.)
Manheim Dallas (Irving, Texas)
Manheim Fredericksburg (Rockville, Md.)
Manheim Omaha (Davenport, Iowa)
Manheim San Diego (Orange, Calif.)
The 2017 Auction Achievement Award winners in the damaged-vehicle category are:
Dealers Auto Auction of the Rockies (Highlands Ranch, Colo.)
IAA Atlanta (College Park, Ga.)
Manheim Dallas TRA (Irving, Texas)
Manheim NJ TRA (Wayne, Pa.)
Manheim Southern California TRA (Orange, Calif.)
Manheim Tampa TRA
Metro Salvage Pool (Davenport, Iowa)
A Kansas auto dealer has been sued by the state for violating state consumer protection laws and is temporarily banned from doing business.
Justin Bogina and his business, Auto Acceptance Center Corp., of Topeka, have been temporarily ordered to refrain from conducting business related to the sale of property or services within the state of Kansas.
The state’s attorney general filed a lawsuit against Bogina and his company alleging multiple and recurring violations of Kansas consumer protection law over the past several years and continuing to the present.
Among the allegations is that in 2014 Bogina advertised he would donate $100 per vehicle sold during a specific time period to the memorial fund established for Topeka Police Corporal Jason E. Harwood, who was killed in the line of duty on Sept. 7, 2014. However, the defendants did not track the sales for the purpose of making the donation, and no donation was made until April 2016, after the attorney general’s office launched its investigation.
The lawsuit also alleges the defendants represented the sale of vehicles to be “as-is,” took possession of a trade-in vehicle without paying the proper balance due and sold vehicles to customers without providing certificates of title, all in violation of the Kansas Consumer Protection Act.
Cars.com Inc. saw its dealer customer count decline in the third quarter, dipping to 21,307 from 21,465 in the second quarter.
Average vehicle listings were 4.9 million, up 6 percent year-over-year.
Revenue was $159.9 million in the third quarter, down 1 percent year-over-year.
Net income was $21 million.
Average monthly unique visitors for Cars.com was up 3 percent year-over-year. But total traffic declined 1 percent to 101.7 million.
Mobile traffic grew 8 percent year-over-year and accounted for 59 percent of total traffic compared to 54 percent in the third quarter of 2016.
After a 6-month pilot with Retail Automotive Alliance (RAA), a leading motor dealer group across the UK, Integrated Auction Solutions has launched a countrywide customized RAA MarketPlace.
This includes a native iOS and Android applications, which allows vehicles to be traded and sold with any mobile device. The RAA group plans to initially sell inventory internally with this system, then move to a full retail application - selling part exchange vehicles (trade-ins) and frontline inventory to the open market with real-time offer technology.
The Federal Trade Commission’s Economic Liberty Task Force has announced the agenda for its second roundtable in Washington, D.C., on Nov. 7, to examine empirical evidence on the effects of occupational licensing.
“The Effects of Occupational Licensure on Competition, Consumers, and the Workforce: Empirical Research and Results” will bring together experts who have studied and attempted to quantify the effects of occupational licensing regulations on service providers, consumers, and markets.
The Task Force’s first roundtable, held in July, focused on enhancing license portability across state lines.
The Nov. 7 roundtable will focus on the ability of empirical research to clarify costs and benefits, and to better inform policy makers’ discussions of occupational licensing reform.
It is free to the public and begins at 1 p.m. at Constitution Center, 400 7th St., SW, Washington, D.C., 20024. The FTC invites comments from the public on the topics to be addressed.
The National Independent Automobile Dealers Association had selected Wheel’s Automotive Dealer Supplies Inc. as the exclusive supplier of point-of-sale merchandising, collateral, and printing services for the NIADA Certified Pre-Owned Vehicle Program. Materials are available in English or Spanish.
Wheel’s Automotive also services 19 OEM and other provider CPO programs.
This NIADA CPO program includes Wheel’s print-on-demand and direct-from-manufacturer convenience to furnish NIADA member dealers with the exact customized CPO marketing materials desired.
The New York attorney general announced two separate settlements that cost more than $900,000 in restitution and $135,000 in penalties and costs.
The state had charged Garden City Nissan, Nissan of Huntington, VW of Huntington, Potemkin Hyundai and Potemkin Mitsubishi with the unlawful sale of credit repair and identity theft protection services.
Often, these after-sale items added hundreds or thousands of dollars in hidden charges to the sale or lease price of a vehicle. The costs of these items were often bundled into the vehicle sale price and not separately itemized.
The attorney general’s investigation showed that with some dealers, consumers were totally unaware that they had received these services. In many other cases, consumers thought that the services were free.
As a result, often unbeknownst to the consumer, the price of the car stated on purchase and lease documents was inflated by the amount of these after-sale items.
A San Antonio car dealer was indicted by the Texas Comptroller for allegedly failing to remit between $20,000 and $100,000 in motor vehicle taxes and between $2,500 and $30,000 in title and registration fees collected on 105 vehicles between October 2015 and July 2016.
Carlos Brun, the owner of National Auto Credit, is charged in two separate indictments with failure to remit motor vehicle tax collected, a third-degree felony punishable by two to 10 years in prison and up to a $10,000 fine, and misapplication of fiduciary property, a felony punishable by confinement in a state jail for six months up to two years.
The case is pending prosecution