The Federal Trade Commission (FTC), a branch of the U.S. government responsible for protecting American consumers, announced last week that auto-related complaints are on the rise. Out of 30 tracked categories, auto issues captured the fourth spot with 77,435 complaints in 2011.
More than a third of the cases filed last year concern shady practices when buying used cars while nearly 2 in 5 allege being taken advantage of while purchasing new cars. The remaining auto issues involve vehicle leasing and rentals, maintenance and repairs as well as warranty plans and lending.
Identify theft, debt collections, national banks, lending, and advance fee loans, which make up the overall top five grievance, have all impacted the auto industry as well. On June 7, the FTC filed unprecedented charges against Franklin Toyota/Scion, a car dealership in Statesboro, Ga., for leaking the personal data of 95,000 customers and misrepresenting the company’s security and privacy measures. The settlement requires Franklin to establish a comprehensive security program that ensures the safety of each customer’s private information. The auto dealer must also submit to biyearly data security audits over the next 20 years.
Additionally, a federal judge ruled on May 27 that auto dealers are responsible for informing loan applicants of negative marks on their credit report that trigger higher interest rates and longer terms. Although the FTC won the first battle against the National Automobile Dealers Association (NADA), the 16,000-member professional organization plans to appeal the decision.
Victimized consumers can file complaints with the FTC as well as the Better Business Bureau Auto Line, which seeks resolutions for warranted repairs, and the Center for Auto Safety, which offers an attorney referral service. Both organizations provide information about lemon laws, common auto problems, and vehicle recalls. The FTC also supplies comprehensive auto buying guides and updated consumer alerts.
J.D. Power and Associates advises consumers to invest time in researching the auto dealership’s reputation as well as the intended vehicle’s price, features, and available accessories. Shoppers should pay particular attention to the average cost of maintenance, repairs, and warranty options.
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