Author Archives: Jay Butchko
The Used Car Rule
While many of the laws that protect consumers from fraud when purchasing used cars are passed by state legislatures, a number of rules were also put in place by the federal government. For instance, the Federal Trade Commission (FTC) enforces a federal regulation known as the Used Car Rule, which requires dealerships to disclose… Read More »
Non-Disclosure and Affirmative Misrepresentations by Used Car Dealers
Most fraudulent activity that takes place during the sale of used vehicles falls under one of two categories: non-disclosure or affirmative misrepresentations. The first occurs when a dealer purposely withholds information that affects the value or desirability of the vehicle, while the latter involves taking a more active role in misleading customers. Fortunately, both… Read More »
Yo-Yo Financing Tactics
Of the many fraudulent tactics used by unscrupulous used car dealers, yo-yo financing is perhaps the most common and devastating to buyers. Yo-yo financing occurs when a buyer signs a contract, takes the car home, but then is notified weeks later that his or her financing wasn’t actually approved, and the car must be… Read More »
The Dangers of Odometer Fraud
Recently, the owner of an Arizona used car dealership was arrested for selling vehicles with false odometer readings to unsuspecting consumers. During its investigation, the Arizona Department of Transportation discovered that in addition to altering the mileage on its vehicles, the dealership had also removed the letter “C” designation from many of their titles,… Read More »
Pennsylvania Law May Make it Easier for Used Car Dealers to Sell Defective Vehicles
Last year, the Pennsylvania Legislature passed a new state law that requires used car dealers to disclose when one of their vehicles is subject to an open recall. Initially hailed as a victory for consumers across the state, a number of safety groups have since raised concerns that the law can actually be used… Read More »
Signs that Your Transmission May be Defective
The transmission plays a critical role in the proper functioning of any vehicle, as it transfers the rotational power generated by the engine to the car’s wheels. This in turn, makes it possible for the gear ratio between the engine and the wheels to change as a vehicle speeds up and slows down. Although… Read More »
Undisclosed/Concealed Frame Damage
Under Pennsylvania law, used car dealers are required to disclose when their vehicles have certain types of damage, including bent and cracked frames. Unfortunately, this type of damage is difficult to see with a visual inspection, so when unscrupulous dealers fail to disclose problems with a frame, an unknowing purchaser could end up with… Read More »
Pennsylvania Dealership to Pay More than $2 Million in Fines for Fraud Scheme
Early last month, a Pennsylvania used car dealership agreed to pay more than $2 million in restitution and fines for selling vehicles at falsely inflated prices to subprime consumers. Unfortunately, this type of conduct is not uncommon in the used car sales industry, so if you were recently taken advantage of by a dealership… Read More »
The FTC and the Used Car Rule
In 1985, the Federal Trade Commission (FTC) instituted the Used Motor Vehicle Trade Regulation Rule. More commonly referred to as the Used Car Rule, these regulations require used car dealers to display window stickers, known as Buyers Guides, on all used cars. These stickers contain important information about the vehicle being sold, including information… Read More »
The Puppy Dog Close
Used car dealers are notorious for using certain sales tricks to convince consumers to buy a vehicle. For instance, most people have heard of the bait and switch technique, which involves advertising cars at an apparent bargain and then substituting more expensive or inferior vehicles when consumers actually show up at the lot. While… Read More »
