On August 15, 2024, the FTC and the State of Arizona announced they had taken action against the owner of several car dealerships and one of their employees for allegedly deceptive advertising practices and alleged overcharging of Latino customers.
According to the Complaint, the dealerships advertised prices that were thousands of dollars below the retail price for the vehicles in order to lure customers to the dealership; when customer arrived at the dealership, they were allegedly told the advertised price was no longer available. The Complaint further alleges that the dealerships added on hundreds of thousands of dollars in junk fees labeled as “market adjustments,” add-on products, and other miscellaneous fees. Finally, the Complaint alleged that Latino customers paid nearly $1,200 more in interest and add-on charges than their non-Latino White counterparts.
As part of a consent order with the FTC and Arizona, the dealership agreed to pay $2.6 million, $2.35 million of which will be used to provide refunds to customers. Additionally, the dealerships will establish a fair lending program with internal compliance backstops.