NEWARK – Attorney General Gurbir S. Grewal and the Division of Consumer Affairs today announced that a used car dealership in Burlington County has agreed to change its practices, pay a settlement of $55,000 in civil penalties, $3,700 in investigative costs, and enter binding arbitration with several consumers who say the dealership deceived them by refusing to honor advertised prices of vehicles, failing to disclose known vehicle history, and cancelling warranties without notifying customers or issuing refunds, among other deceptive tactics.
Royal Auto Group, Inc. (Royal) agreed to the terms under a Consent Order that settles the Division’s investigation into allegations that the dealership committed multiple violations of the New Jersey Consumer Fraud Act, the Motor Vehicle Advertising Regulations, the Automotive Sales Practices Regulations, the Used Car Lemon Law, and the Used Car Lemon Law Regulations.
“New Jersey consumers expect and deserve honesty and transparency as they navigate the sometimes-stressful process of purchasing a used motor vehicle,” said Attorney General Gurbir S. Grewal. “This settlement sends a message to dealerships that they cannot get away with deceiving consumers for profit.”
Royal allegedly engaged in deceptive conduct that included:
- Advertising used motor vehicles for sale without including all charges due
- Failing to disclose prior vehicle damage
- Charging consumers separately for pre-delivery services, including dealer preparation fees without itemizing the price for each actual documentary service performed
- Failing to disclose prior damage, grey market and rental histories of used motor vehicles for sale
- Charging consumers for warranties that were later canceled without disclosing the cancelation or issuing a refund
“Buying a used car should not be a guessing game,” said Kaitlin Caruso, Deputy Director of the Division of Consumer Affairs. “Consumers have a right to know the known history and full price of vehicles they are purchasing and that a warranty they purchase will be in full force if they ever need to file a claim.”
Under the Consent Order, Royal agreed to change the way it does business, including:
- Not engaging in unfair or deceptive business practices
- Maintaining documentation of all advertisements of motor vehicles leased or sold to consumers for 180 days from the date of lease or sale
- Disclosing prior vehicle damage, grey market history and/or rental history of used motor vehicles to consumers
- Including in its advertisements the required language and itemizing all costs to be paid by the consumer except for licensing costs, registration fees, and taxes
- Ensuring all warranties sold to consumers are issued in the consumer’s name and to their motor vehicle, and issuing refunds if there are processing errors
Also under the Consent Order, Royal will enter binding arbitration to address pending consumer complaints. In addition, any complaints received by the Division over the next two years that are not resolved by the company will also be referred for binding arbitration.
Investigator Kelly Fennell of the Division of Consumer Affairs' Office of Consumer Protection conducted this investigation.
Deputy Attorney General Chanel Van Dyke from the Consumer Fraud Prosecution Section within the Division of Law represented the State in this matter.
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 Division of Consumer Affairs by visiting its website or call 1-800-242-5846 to receive a complaint form by mail.