GM Dealers Guilty of Deceptive Sales Practices, FTC Claims

GM Dealers Guilty of Deceptive Sales Practices, FTC Claims
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July 24, 2015

A major American car manufacturer may be in hot water again.

The Federal Trade Commission (FTC) is investigating whether General Motors (GM) is guilty of utilizing misleading marketing practices in the sale of new cars, according to the Detroit Free-Press. The FTC claims that GM dealers are promoting used vehicles as "certified pre-owned" despite failing to ensure that repairs detailed under publicly announced recalls have been made.

GM was notified of the charges last month, but the information was made public this week through a quarterly filing with the Securities and Exchange Commission (SEC) detailing second-quarter financials.

"On June 3, 2015, we received notice of an investigation by the Federal Trade Commission concerning certified pre-owned vehicle advertising where dealers had certified vehicles allegedly needing recall repairs," the filing states. "We continue to investigate these matters and believe we are cooperating fully with all requests for information in ongoing investigations."

The investigation could result in significant fines, civil consent orders, and/or criminal penalties.

An FTC spokesman was not willing to comment on the matter.