On March 9, 2020, the Massachusetts attorney general’s office (Massachusetts AG) announced that it had entered into a consent judgment with a national used car company resolving allegations that the company’s local Massachusetts franchise engaged in predatory lending and deceptive sales of defective vehicles.
According to the Massachusetts AG’s complaint, filed in September 2017, the company sold vehicles at more than twice their actual value, used an underwriting process that qualified consumers for loans they could not afford, and sold service contracts stipulating that consumers could only get their vehicles repaired by the company. The complaint further alleges that the company used aggressive and misleading advertising and sales tactics that put consumers at high risk of default and repossession.
The consent judgment was entered in Suffolk Superior Court, and requires the company to pay $1.5 million in restitution and relief to consumers who purchased cars from the company’s various locations between 2013 and 2017. The company must also change its business practices so that it provides fair disclosures and enhanced repair services.
The resolution of the matter is part of a series of recent actions taken by the Massachusetts AG targeting the auto industry, previously covered here, here, here, and here.