Reviewed by Attorney Charles P.
False advertising remains highly prevalent across the auto sales industry, misleading countless buyers into overpaying or purchasing defective vehicles.
This article explains common deception tactics used by dealerships, cites data on advertising fraud prevalence, and provides expert tips to avoid becoming a victim.
Common Car Dealer Cons and Scams
Beyond generalized lies about specifications or condition, some of the most widespread examples of misleading auto ads include:
- Bait-and-Switch Pricing – Advertising an unusually low price to get buyers on the lot before claiming limited availability or problems with financing approval on that specific vehicle. High-pressure tactics push customers towards higher priced models. This occurred at dealerships including Honda of Hollywood and Subaru Pacific.
- Artificial Scarcity – Dealers create the illusion of high demand and limited inventory by advertising a car at a certain price for a short period despite having continual access to supply. The Toronto Star exposed wide use of this approach during sold-out “discount sales” at 14 dealerships.
- False Rebates – Fine print disqualifies the vast majority of shoppers from actually attaining an advertised rebate. Or rebates depend on trade-ins valued well below market rates. Jim Click Dodge ran afoul of state regulations for precisely this tactic.
Many of these and related practices clearly violate truth-in-advertising regulations if resulting in consumer financial loss.
Alarming Incidents and Statistics on Car Dealer Fraud
Recent FTC Enforcement Efforts in the Automotive Sector
The Federal Trade Commission (FTC) has significantly ramped up its regulatory actions in the automotive industry. Demonstrating a strong commitment to consumer protection, the FTC has initiated over 50 targeted law enforcement actions against auto dealerships.
It spearheaded two extensive nationwide sweeps, encompassing 181 state-level enforcement actions, to curb malpractices in this sector.
Reflecting the gravity of the issue, the FTC has consistently received an overwhelming volume of consumer grievances regarding auto dealer conduct, registering more than 100,000 complaints each year for the past three years.
Such a high volume of complaints categorizes automobile dealer conduct among the top ten most reported issues to the FTC, underlining the persistent challenges consumers face in this market.
With car shopping already stressful enough, consumers require reliable guidance around advertising fraud prevention.
Protecting Yourself Through Careful Documentation
If exposed to a potentially illegally misleading dealership ad, experts emphasize moving swiftly to compile documentation including:
- Saving copies of any advertisements across channels containing concerning claims, offers, or vehicle information
- Recording all communications with sales staff related to the advertised promotion and purchase process
- Keeping detailed chronological logs of events as they unfold, outlining how a dealer reneged on or appended unexpected terms
- Screen capturing online activity like vehicle listings and website shopping cart changes
This complete evidence trail lays the groundwork for productive complaints and bolsters legal arguments around damages owed after fraud.
Holding Dealers Accountable for False Ads
If you uncover an intentionally misleading car advertisement that results in you overpaying or buying an unsuitable vehicle, take action by:
- Reporting the Dealership: File complaints with groups like the FTC, your state’s attorney general’s office, and the Better Business Bureau explaining exactly how the dealer tricked you through false advertising. Provide copies of ads and detailed logs. Official complaints can trigger investigations into shady business practices.
- Contacting Consumer Protection Attorneys: Lawyers well-versed in auto fraud can review your situation and evidence then clearly explain options to recoup financial damages. Recent class action lawsuits have secured thousands of dollars in settlements for car buyers scammed by ads. An attorney sends the message you are serious about being compensated.
- Warning Online Audiences: Post detailed reviews recounting the bait-and-switch schemes or deceit experienced at crooked dealers on sites like Yelp, Google Business Profiles, ConsumerAffairs.com, and more. Your story can prevent others from getting similarly swindled. Negative publicity pressures dealerships to end systematic false advertising.
Pursuing legal action serves not only to redeem significant auto purchase costs, but dissuade other dealerships from continuing similar advertising fraud against unknowing car shoppers.
Consumers have power when they band together against unscrupulous sales tactics.
You Buy Auto Ads Too – Beware False Savings Claims
As vigilance represents the front line of defense again deceptive auto offers, consumer agencies advise caution when you see:
- Unbelievable prices or discounts promoted for very short periods
- Rebate offers with pages of fine print exceptions and caveats
- Vehicles listed as certified pre-owned despite extreme mileage
Simply letting the dealer know you notice questionable claims or confirm their legitimacy may illuminate their fraud in the making.
Your awareness protects not only your own wallet, but the wider car buying public vulnerable to schemes still rampant industrywide.
Contact our Auto Fraud and Lemon Law Attorney to Report Auto Dealer Fraud
A vehicle purchase is no small decision and auto dealer frauds are a big deal. Cars are expensive, and from the down payment to monthly payments, you will be pouring your hard-earned money to get a vehicle.
On top of the high purchase price, vehicles are also something that you rely on to use on a daily basis. Before making a purchase with a dealership, research your car and see if there is a history of defects or if the dealer has a good reputation.
If you have been harmed or misled by false internet advertisements, you should contact a lawyer for advice. Call our experienced auto fraud and lemon law attorneys, so you can discuss your issue, know your options, and find a better outcome.
You might be entitled to compensation, and our auto fraud and lemon law attorney can help you exercise your rights and put a stop to deceptive advertising practices.
Remember, the law is on your side.
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