Is That Used Car for Sale Really a Repo or Government Surplus?
"We're laying on the horn because too many advertisements suggest that the cars being sold are repos available for a limited time and at a special price," Assistant Attorney General Mary Lobdell said in a statement. "In reality, the cars are from the dealer's standard inventory and the ads typically fail to disclose that prices are contingent on the buyer's ability and willingness to obtain financing."
Action Integrated Marketing, a Norcross, Ga., firm, and its CEO Jay D. Murphree signed a settlement agreement over accusations of deceptive advertising practices. Washington state regulators said Action Integrated Marketing designed promotions that included misrepresentations about where vehicles came from, created a false sense of urgency, failed to include enough information about prices and terms, and failed to disclose all charges including a documentary fee. The promotions ran in Washington and other states.
Under a multistate settlement, Action Integrated Marketing and Murphree agreed to restrictions on their marketing practices. In addition, the defendants will pay $150,000 to reimburse participating states for attorneys' fees. A $130,000 penalty will be suspended if the defendants comply with the agreement.
Other states taking part in the settlement include: Georgia, Idaho, Illinois, Kentucky, North Carolina, Ohio, Oregon, Pennsylvania and Tennessee.
Murphree told Consumer Ally that he denies the allegations against him and Action Integrated Marketing. He said at the events in question, there were some cars for sale that were repossessed or were former government vehicles, in line with what was was being advertised.
Murphree said he will use wording changes in his advertisements outlined in the settlement agreement. He said he signed the agreement to end the "three-year nightmare" of state investigations.
If you need to buy a used car, research car performance or make a list of what cars you're looking for, don't be swayed by high-pressure sales and have the car you're going to buy checked by an independent mechanic.
See the BBB's "Tips for Buying a Used Car" and "Know the Facts About Used Car Fraud Before You Buy" for more information.