If car shoppers expect to pay a certain amount for a vehicle and then learn that they’re on the hook for hundreds or thousands of dollars more, it can be a confusing and aggravating experience, to say the least. And it could have been the result of misleading advertising. That’s why the Federal Trade Commission filed a complaint against a Southern California dealer. The Conant Auto Retail (CAR) Group said the allegations are without merit and has admitted no wrongdoing, but it has nevertheless agreed to settle with the FTC for $1.4 million.
The FTC said some of the company’s dozen Norm Reeves dealerships in California and Florida violated several consumer-protection laws by leading car shoppers to believe they could finance vehicles for low monthly payments, or lease vehicles with no money down, while failing to adequately disclose associated costs. The ads were run despite a 2014 consent agreement that prohibited the Norm Reeves dealers and nine other dealership groups from allegedly misrepresenting the costs of vehicles. But shortly after signing, some Norm Reeves dealers kept running ads that violated the agreement, the FTC said. In its complaint, the FTC pointed to more than a dozen examples of ads run on several media platforms and in email promotions. In one ad shown below, Norm Reeves Buick GMC in Irvine, California, was running an ad on its homepage in 2015 that offered zero percent APR for 60 months. The FTC said the ad failed to disclose the a...