WASHINGTON — A nationwide crackdown on auto dealers has turned up widespread evidence of false ads, deceptive loans and fake odometer readings, the government said Thursday.
The investigation led by the Federal Trade Commission and law enforcement resulted in 252 enforcement actions and $2.6 million in consumer refunds and fees.
It was the second time that the FTC has gone after the car industry. Last year, the agency announced 10 cases of deceptive advertising and loans. Officials say the more recent investigation in U.S. and Canada involved the Justice Department and state prosecutors.
“The clear message is that across this country, and indeed internationally, law enforcement agencies are on the lookout for deceptive and illegal practices by auto dealers and will take whatever action is necessary to protect consumers,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection.
In one case, a company called the National Payment Network Inc. in San Mateo, Calif., set up car buyers with an automated payment program that was pitched as a way to save money. But regulators said the fees canceled out any savings.
For example, a standard five-year auto loan would charge $775 in fees. Matt Blatt dealerships, which have multiple locations in New Jersey, worked with National Payment Network to sell loans and received commission for the more than 1,000 consumers they enrolled, accord to the FTC.
