New Jersey Division of Consumer Affairs Reaches Settlement with Dealer of High-End, Used Luxury Cars Accused of Deceptive Sales Practices
NEWARK - 21st Century Auto Group, Inc., a Springfield, New Jersey-based motor vehicle dealership accused of violating the state's Consumer Fraud Act and motor vehicle regulations, will pay $130,000 to settle the lawsuit filed against it by the Division of Consumer Affairs. The dealership also will hire a Compliance Monitor at its own expense to ensure that its business practices comply with consumer protection laws and regulations concerning advertising practices, auto sales, and used car lemon law practices.
As part of the settlement, 21st Century Auto Group will resolve 43 consumer complaints previously filed with the Division of Consumer Affairs through negotiation with the complainants. If the dealership and the consumer cannot agree on settlement terms, the complaint will be referred to binding dispute resolution, under terms of the Final Consent Judgment with the state.
In December 2013, the state filed suit against 21st Century Auto Group in the Superior Court, Chancery Division, in Union County, alleging that the dealership committed multiple violations of the Consumer Fraud Act, motor vehicle advertising regulations, automotive sales regulations and used car lemon law regulations. The alleged violations included, among other things, failing to disclose the prior use of motor vehicles as rental vehicles, failing to disclose past damage to and repair of motor vehicles, continuing to advertise motor vehicles after these vehicles had actually been sold (bait-and-switch), failing to honor advertised and negotiated prices of user motor vehicles, and delayed return of traded-in motor vehicles and/or deposits after the sales contract was cancelled by the consumer.
The dealership primarily sells high-end used luxury cars such as Lamborghinis and BMWs.
"Consumers were allegedly not being informed of information that affected the value of the vehicles they purchased," Acting Attorney General John J. Hoffman said. "This settlement provides a mechanism for compensating these consumers. All sellers of used vehicles should take notice of this outcome and know that we will not tolerate any failure to disclose such information from prospective buyers, nor abusive sales practices."
Under the terms of the settlement, 21st Century Auto Group will pay $100,513 in civil penalties and will reimburse the state $29,487 for its attorneys' fees and investigative costs. The dealership will also pay up to $20,000 for a Compliance Monitor who for the next year will check for its compliance with the Consumer Fraud Act and various motor vehicle regulations, as well as with the terms of the settlement.
"The outside monitor will report to the Division about how the dealership is conducting business over the next year. We insisted on this monitoring to ensure that consumers are not subjected to deceptive sales practices and that the dealership honors its legal commitment to adhere to New Jersey's consumer protection laws," said Steve Lee, Acting Director of the Division of Consumer Affairs.
Investigator Kelly Fennell, in the Division of Consumer Affairs Office of Consumer Protection, conducted this investigation.
Deputy Attorney General Jeffrey Koziar, of the Consumer Fraud Prosecution Section in the Division of Law, represented the state in this action.
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse,
can file an online complaint with the State Division of Consumer Affairs by visiting
its website or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504- 6200.
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