On January 20, the New York Attorney General’s Office (Attorney General) announced that it had filed a complaint against several New York auto dealerships over allegations that the dealerships sold deceptive “after-sale” products to consumers. The lawsuit alleges that the dealerships partnered with an independent credit repair company to charge 1,426 consumers up-front fees for credit repair services. Allegedly, the dealerships often failed to disclose these fees, and no credit repair services were ever provided to consumers. The lawsuit further alleged that the dealerships violated New York law by failing to provide the terms of retail sales installment contracts in Spanish to Hispanic consumers. The lawsuit seeks an injunction prohibiting the dealerships from engaging in similar practices in the future, and an order requiring the dealerships to refund over $1 million it has charged consumers for credit repair services.
Separately, the Attorney General announced that it had reached settlements with several other auto dealerships to resolve identical allegations. Under the terms of these settlements, the auto dealerships will pay a combined $118,000 in consumer relief, $10,000 in penalties, and $5,000 in costs.
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