Spitzer Continues Crackdown On Auto Dealer Advertising

In a continuing effort to reform the advertising practices of the auto industry, Attorney General Spitzer today announced a series of settlements with Hudson Valley auto dealers.

Spitzer's office alleged that at least four auto dealers promoted auto auctions and used false and misleading claims in their advertisements. Many of these deceptive campaigns were developed by an independent auto ad promoter who was also a target of today's enforcement actions.

"My office will continue to monitor auto advertising claims closely to ensure that consumers are provided with forthright, truthful information with which to make good purchasing decisions," Spitzer said.

"Jeff Weaver's 96 Hour Supersale, Inc." and its principals, Jeffrey Weaver and his wife, Micki Weaver, have been operating as an auto ad promoter from their Long Island home since at least 1997. The company sells advertising and sales promotions to car dealerships throughout New York and other states and actively manages the special sales events promoted in the ads it creates.

Spitzer's investigation revealed that as a result of Weaver's promotions, at least three dealerships violated federal and state consumer protection laws. New Rochelle Chevrolet, Poughkeepsie Chevrolet Oldsmobile Cadillac, and Rockland County Chevrolet settled false advertising investigations against them and paid fines totaling $50,000.

In addition, Healey Lincoln Mercury, LLC settled a false advertising case for similar practices and paid a fine of $5,000.

Weaver's engaged in a fraudulent campaign to promote "Repo Sales" with misleading offers to consumers. According to the promotion, with the payment of a modest fee, consumers could take over the payments of the former owner of a repossessed vehicle. Weaver's then directed its client auto dealers to stock up on used vehicles without regard to whether they were repossessed cars. The ad promoter posted signs in the windows of the vehicles with fabricated payment numbers falsely implying this information to be the monthly payments of the former owner.

Spitzer's investigation revealed other practices designed to mislead the public. These include:
  • Luring customers with false claims that certain vehicles could be bought for $59 down and $99 per month, when no vehicles were offered or sold at such terms;
  • Misrepresenting the size of the inventory involved in a sale and the plans for the vehicles remaining after the event (e.g. implying that special bargains could be obtained at the sale by stating that any unsold vehicles would be sent to auction);
  • Falsely indicating that anyone could get financing regardless of credit worthiness with such claims as "Credit Problems? No problem!"; and
  • Falsely implying a bankruptcy or liquidation sale with ads and flyers entitled "Public Notice" that stated the auto dealer had been "ordered" to greatly reduce vehicle prices.
In settling the case, Weaver's paid $25,000 in penalties and agreed to cease its fraudulent marketing and advertising campaigns.

In addition to these enforcement efforts, Spitzer's Poughkeepsie Regional Office is hosting a seminar at the request of area auto dealers to provide guidance and education about advertising practices.

Today's settlements represent the second round of cases from an "auto advertising sweep" that Spitzer announced in August of 2001. The earlier cases resulted in nearly 50 auto dealers across the state paying almost $500,000 in civil penalties for their violations of the law.

Individuals with complaints about auto dealers are encouraged to contact the Attorney General's consumer help line at (800) 771-7755.

This case was handled by Assistant Attorney General G. Nicholas Garin of the Poughkeepsie Regional Office assisted by Senior Consumer Fraud Representative Mark Hoops.