RSS
|
|
Under the deal, the six Vester dealerships agree to numerous reforms and will pay the Attorney General's Office $100,000 “for customer education and attorneys' fees.”
North Carolina Attorney General Roy Cooper announced the pact Wednesday. In a press release, Cooper said, “Buying a car can be expensive and complicated ... We want to make sure that consumers get good information about the true cost of buying a car.”
Dealership owner Alan Vester told the Daily Herald, “I am pleased that Attorney General and I were able to reach an agreement about how folks looking to buy a car ought to be treated. This agreement will provide further assurance to our customers that they will treated fairly and squarely.”
In his press statement, Cooper said he would like to see all car dealers make the changes Vester will implement in order to ensure North Carolina consumers are given fair and equal treatment when purchasing a vehicle.
Vester said he had been treated fairly by the Attorney General's Office but declined to discuss what led to the negotiations and the settlement.
The attorneys in the Consumer Protection Division first started looking into “the advertising, sales and financing practices” at the six Vester dealerships in July 2005, according to the police.
The press release says, based on the investigation, the attorneys “contend that Vester dealerships targeted consumers with poor credit” with “misleading ads.” This included people going through bankruptcy, divorce or who had lost their jobs.
The Attorney General's office also alleged finance companies were misled by Vester dealership which provided false income information and misrepresented the source of down-payments to help qualify consumers for financing.
The Attorney General's press release said the dealerships' reforms include:
€ Capping the percentage points added on to transaction financed through the dealer. The press release explains when a dealer arranges financing for the consumer, the lender quotes the dealer and interest rate. “Many times, the dealer adds percentage points to the rate to make more money of the transaction.” Under its agreement with the Attorney General's office, the Vester dealerships will limit that mark up to no more than 2.5 percent over the quoted rate for loans of 60 months or less, and 2 per cent for longer-term loans.
€ Provide consumers with detailed information about finance charges and “back-end” options such as warrantees. Under the program, consumers must be told what options are included in the price, the total price of the vehicle without the options and, if the financing is being handled through the dealer, how much their monthly payments will increase due to the options.
€ Comply with state and federal advertising and lending regulations. Vester dealerships will train managers on financing, sales and advertising laws and practices under the program. Additionally, under the agreement, each Vester dealership will designate a coordinator to review and respond to complains and “serve as the primary point of contact with the Attorney General's office.”
Comments