A.G. Schneiderman Wins Restitution For Victims Of Deceptive Practices At Giuffre Auto Dealerships
Brooklyn Car Dealerships Will Pay $300K Restitution To 46 Consumer Victims Duped Into Buying Cars After Terms Of The Sales And Financing Were Misrepresented
Schneiderman: We Will Aggressively Prosecute Businesses Across The State That Defraud Their Own Customers
AG Issues Tips To Protect Consumers When They Are Purchasing A Car
BROOKLYN -- Attorney General Eric T. Schneiderman today announced a victory for consumers in a lawsuit against Giuffre Hyundai, Giuffre Kia, Giuffre Mitsubishi, Giuffre Mazda, and the owner of the Bay Ridge auto dealerships, John Giuffre, for persistent fraudulent, deceptive and illegal business practices in the sale and financing of automobiles. The illegal practices left some consumers with ruined credit reports.
The Honorable Bernard J. Graham of Kings County Supreme Court ordered the businesses to pay a total of $510,000, including restitution in the amount of $294,500 to 46 victims, and $215,500 in civil penalties and costs.
“This order is a victory for consumers who were ripped off by Giuffre car dealerships. My office will continue to aggressively monitor business practices of dealerships around the state to ensure they comply with the laws designed to keep the auto market honest and maintain a level playing field for consumers,” Attorney General Schneiderman said. “The deceptive conduct led consumers to sign contracts which did not reflect the negotiated sale terms, frequently including unwanted aftermarket add-ons. Some of these transactions led to repossessions and ruined credit, as the consumers found themselves owing more than they ever would have knowingly agreed to pay.”
The action was brought against the Giuffre dealerships after the Attorney General’s office received complaints from numerous consumers and conducted an investigation into the dealership’s practices. The Attorney General alleged that Giuffre engaged in a pattern of fraudulent and deceptive practices by the dealerships, including publication of misleading advertisements in the form of deceptive contest promotions; misrepresenting the terms of the sale and financing during sales negotiations; adding the costs of unwanted aftermarket items into contracts and financing agreements; and using high pressure sales tactics to induce consumers into signing blank contracts.
In his decision, Judge Graham found that the evidence presented showed “a common practice of strong-arm sales methods and unethical conduct” by the dealerships, which he found to be “extensive and unsettling.” The Judge also noted the “brazen nature of the sales persons employed by” Giuffre, and that many of the victims were “older persons, unsophisticated, or unfamiliar with English, and each person wound up owning a car that they never intended to buy or a price that was dishonestly represented to them.”
The dealerships are enjoined from any further violation of NY Executive Law § 63(12), NY General Business Law §§ 349 and 350, NY Insurance Law § 7906, the NY Motor Vehicle Retail Installment Sales Act, and the Federal Truth in Lending Act. Giuffre also has to take steps to have credit reporting agencies, banking institutions, creditors and lenders remove negative credit information entered against Giuffre customers attributable to Giuffre’s fraudulent, deceptive or illegal business practices.
The case was handled by Assistant Attorney General Matthew Eubank with the assistance of Lois Booker-Williams, Assistant Attorney General In Charge of the Brooklyn Regional Office, under the supervision of Jane Azia, Chief of Bureau of Consumer Frauds and Protection, and Executive Deputy Attorney General Marty Mack for Regional Affairs.
The Attorney General also issued tips to protect consumers when purchasing a vehicle:
- Before you start looking at cars determine what you can afford to pay;
- Do your research.Check Consumer Reports or other auto research resources before going to the dealerships. Negotiating is easier if you know what the dealership paid for the car and what other consumers are paying;
- Check with the Better Business Bureau(www.bbb.org) to find out if the dealer is reputable;
- Don’t give in to high-pressure sales tactics and don’t be afraid to walk out of the dealership if you feel you are being manipulated;
- Shop around for financing.You can arrange financing through your own bank or lender rather than relying on the dealership’s offer;
- Take your timereading the sales and financing contracts. Don’t let the dealership rush you;
- Manufacturer’s Suggested Retail Price (MSRP). The MSRP is the price recommended by the manufacturer, it will be posted on the window sticker of a new car; Most cars are sold below the sticker price;
- Extended warranties, service contracts, and after market items.These products and policies are expensive and very profitable to the dealer. Check carefully to see what both the manufacturer’s warranty and the extended warranty cover. Often, the items most likely to need repair or replacement are not be covered by the extended warranty
- If the dealership tells you that the lender requires a service contract or other aftermarket product or policy be purchased to obtain a particular finance rate, verify this claim with the lender;
- A copy of the terms and conditions of the service contract must be provided by the dealership. You are entitled to a full refund, less any claims paid, within 20 days of the mailing of the service contract or within 10 days if the contract is delivered at the time of sale;
If consumers feel they have been victimized, they are urged to contact the Attorney General’s Consumer Helpline (800) 771-7755.