Dealer Fraud: Recalled Certified Vehicles

Dealers want to be able to sell vehicles as Certified even if they are subject to open recalls. I addressed this travesty in my last post. A Blogger, Joanne Doroshow, recently posted a very apt blog on the subject.

Ms. Doroshow starts by nailing the context and implications exactly.

With the nation so focused on polls these days, I thought this one might be of interest if you drive a car, drive in a car, are ever on the road with a car, i.e., pretty much everyone. The poll says 9 out of 10 Americans believe that car dealers shouldn't sell used cars with safety defects. Nine out of 10 also believe that if a dealer says a car has passed a "125-point inspection," the car should be safe and without safety defects.

Ms. Doroshow and I share the same concern. That the big bad powerful dealers may get exactly what they want: one more exception or one more loop hole.

Ms. Doroshow turns her guns and criticism on the FTC for shirking its responsibility - indeed its entire purpose for existing - by bowing to the dealers.

The FTC, whose tag line is "Protecting America's Consumers," has decided to side with the corporate lawyers and executives at General Motors and two used car chains, agreeing to a legal settlement regarding the sale of cars under safety recall. Specifically, the proposed settlement would not only allow them to sell used cars under safety recall, but also allow them to say these cars are "safe" and "repaired for safety" and passed a "rigorous inspection." (Sort of like permitting skydiving companies to assure customers that the parachute rig is safe even though there's no parachute.) Perhaps the FTC needs a new tag line.

You should go on the FTC Website and tell them what you think. Tell them that Certified and Open Recalls are mutually exclusive. A vehicle can be Certified, or it can have an Open Recall, but it cannot be both.

So what happened? Ms. Doroshow would like to know. And so would I. And I'm sure you would like to know too.

A lot of people would like to know, including five U.S. Senators. In a recent letter to the FTC and the National Highway Traffic Safety Administration, the senators made clear that allowing dealers "to sell used cars subject to open safety recalls ...is a threat to public safety." But aside from that, the proposed settlement "would establish an anti­-consumer, anti-safety precedent with far-reaching policy implications." More specifically, they say,

Car dealers would still be able to represent that a pre­owned vehicle is "safe," has been "repaired for safety issues," and has passed a "rigorous safety inspection" or to label a pre-owned car as being certified even when it is being sold with an unrepaired safety recall. A certified used vehicle with an unrepaired safety recall is inherently misleading. Perhaps more alarming, the proposed settlements would only require dealers to make a blanket statement that their rigorously inspected and certified used vehicles "may be subject to unrepaired recalls." Consequently, this "disclosure" arguably amounts to nothing more than a legal disclaimer that could absolve dealers from their responsibilities and would likely do little, if anything, to meaningfully convey to consumers the existence of an open recall and dissuade them from purchasing such vehicles due to their safety risks.

Meanwhile, leading safety advocates are appalled. Rosemary Shahan, president of Consumers for Auto Reliability and Safety (CARS), notes:

By allowing dealers the option of selling unsafe vehicles advertised as passing a rigorous inspection and qualifying to be sold as 'certified' with a contradictory 'disclosure,' the proposed settlements would protect unscrupulous, reckless auto dealers instead of consumers. The settlements may also give unscrupulous dealers a new defense, in the case of injury or death, potentially shifting liability onto their victims, and allowing dealers to claim the used car buyers had 'assumed the risk....

There is no other consumer product where a federal agency explicitly allows retailers to sell the product subsequent to the issuance of a safety recall unless the product has been repaired to make it safe.

You can see the entire blog by pointing your browser here:

http://www.huffingtonpost.com/joanne-doroshow/ftc-may-make-it-easier-fo_b_12589356.html

If you or someone close to you has been the victims of consumer fraud or Dealer Fraud, then you or they should contact a qualified attorney right away.

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