FTC Files Complaint against Car Dealers for Deceptive Advertising, Violating Administrative Order

FTC Files Complaint against Car Dealers for Deceptive Advertising, Violating Administrative Order
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December 12, 2014

The Federal Trade Commission (FTC) charged two car dealerships with violating an administrative order and for deceptive advertising.

Billion Auto and Ramey Motors will pay civil penalties and are barred from using deceptive tactics when advertising the cost of buying or leasing a car.

According to the FTC complaint, Billion Auto violated a 2012 administrative order barring the company and associated companies from misrepresenting material costs and terms of vehicle finance and lease offers and requires specific disclosures, mandated by the Truth in Lending Act. The company violated the order by frequently focusing on only a few attractive terms in their ads while hiding others in fine print. Billion Auto have agreed to pay $360,000 in civil penalties to settle the FTC's charges.

Ramey Motors and three affiliated dealerships violated a similar 2012 administrative order by misrepresenting the costs of financing or leasing a vehicle by concealing important terms in the offer, such as the requirement to make a substantial down payment. The company also failed to make credit disclosures clearly and conspicuously and failed to retain and produce appropriate records to the FTC. Ramey Motors and its affiliates are subject to $16,000 in civil penalties for each alleged violation of the FTC order.