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Post date: April 19 2002

Two Nyc Auto Dealers Pay $38,000 To Settle False Advertising Claims

Attorney General Spitzer today announced agreements to reform the advertising practices of two of New York City's major auto dealers.

The Potamkin dealerships and the Bronx Automotive/HB Automotive Groups settled allegations of deceptive and misleading advertising and agreed to comply with federal and state advertising laws and abide by auto advertising guidelines issued by the Attorney General's office.

"Rather than truthfully informing consumers, too many auto ads appear designed primarily to confuse and mislead," Spitzer said. "Such advertising is a costly trap for car buyers and are patently unfair to those dealers whose advertising is honest and truthful."

Some of the misleading advertising claims cited by Spitzer's office against the auto dealers included:

  • Failing to disclose adequately that prominently advertised vehicle prices were obtainable only through high interest loans;
  • Advertising prices without disclosing that these prices were based on rebates and discounts not available to the general public;
  • Falsely implying that all consumers could get credit; and
  • Falsely implying that lenders determine the finance rate when, in fact, the dealership added 2-3 percent interest to the rate offered by the lender.

These two cases evolved from an on-going effort of Spitzer's office to clean up the advertising practices of auto dealers across the state. Last August, Spitzer's office announced settlements with 47 dealers that collectively paid nearly $500,000 in fines for their false and deceptive advertising campaigns. Since that time, another eight settlements have been reached with auto dealers totaling an additional $303,000 in penalties and costs.

Potamkin N.Y.L.P., d/b/a Potamkin Mitsubishi, is located at 706 11th Avenue, Manhattan; Potamkin Cadillac Buick Chevrolet GEO, Ltd. operates franchises at 798 11th Avenue, Manhattan; and Potamkin Volkswagen, Inc. operates a Volkswagen franchise at 11th Avenue and 56th Street. The Potamkin dealerships paid $20,000 in civil penalties and costs,

Bronx Automotive Group, Inc., which does business as Toyota of the Bronx, and HB Automotive Group, Inc., which does business as Bronx KIA and Bronx Subaru, are both located at 333 Boston Road, Bronx. These dealerships paid $18,000 in civil penalties and costs.

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

These cases were handled by Assistant Attorneys General Stephen Mindell and Herbert Israel of the Consumer Frauds and Protection Bureau.