NYC says two Brooklyn dealerships ‘ripped off’ customers, will pay $800K in settlements
The June 28 settlement came less than a week after the Federal Trade Commission proposed new nationwide rules meant in part to combat bait-and-switch advertising. The agency has proposed requiring dealerships that advertise vehicles to show a definitive price (excluding taxes and other government charges) at which they would sell that vehicle to anyone.
The city highlighted misleading advertising in its July 15 news release and featured a victim of the practice, consumer Karinie Olivero.
Olivero saw a 2017 Jeep four-wheel-drive Grand Cherokee advertised by Brooklyn Mitsubishi on CarGurus for $27,994 and sought to buy the vehicle at that price, putting $10,000 down in June 2018, according to the agency. The dealership “rushed” her through documents and ultimately charged her $36,585 for the Grand Cherokee, the city alleged. When Olivero complained, she was told she didn’t qualify for that sale price because of her credit, the city said.
“I wanted to buy a car to provide a better life for myself and my family,” Olivero said in a statement. “But these dealerships preyed on consumers like me with false and misleading information, and they failed to notify me of my rights under the law.”
Brooklyn Mitsubishi’s admission to a single count of deceptive trade practices acknowledged more than a thousand instances of false and misleading prices, more than 3,000 false declarations it didn’t charge dealership fees, and more than 2,700 examples of advertising financing approval as guaranteed when it wasn’t.
The petition shows a New York City dealer can rack up deceptive trade practice violations easily for advertising. For example, every misleading price displayed on an individual dealership or third-party listing website counted as a separate violation, according to the city. Every day each of five YouTube videos existed on the Brooklyn Mitsubishi YouTube channel proclaiming a lack of dealership fees constituted a separate violation, the city said. Some of these were knowing violations, committed after the department alerted the dealership about advertising it found deceptive, the city said.