When You Have to Watch the Watchdog
Can used car buyers assume that certified preowned means recall-free?
Dealer fraud, which is prohibited in New Jersey and Pennsylvania, can happen in certified vehicle misrepresentations as well as the following instances where dealers misrepresent the status or history of a vehicle:
- Car Misrepresentations
- Prior Accidents
- “Yo-yo” Financing
- Negative Equity Nondisclosure
- Odometer Fraud
- Failure to Provide Paperwork
If you’ve been following the “certified preowned-open recall” issue in the news or in our recent blog post you’ll know that a recent Federal Trade Commission (“FTC”) ruling affected the advertising practices of General Motors and two other large used car dealers.
The controversial ruling allows all dealers to advertise used cars as certified preowned vehicles (“CPO”) that were “carefully inspected and repaired” even if there are outstanding unrepaired safety recalls on the vehicles. The FTC—regarded as the watchdog of false advertising and a protector of the public immediately—faced criticism over what consumer groups believed was “tantamount to false advertising”.
In the spirit of a swelling resistance movement in support of the public’s safety, the Center for Auto Safety, Consumers for Auto Reliability and Safety, and the U.S. Public Interest Research Group have now commenced legal action against the FTC in an effort to pressure it to reverse the ruling.
The contention is that the ruling allows dealers to give a false sense of security in telling a consumer that a car that has been certified and inspected when in fact it has a known safety defect that can injure or kill. The public may, to its detriment, equate “CPO” with “safe”.
This would not be a sporadic problem. The scope and volume of used cars with unrepaired safety recalls—spanning virtually all manufacturers—is staggering. There are currently millions of cars with open safety recalls. Just the Takata® exploding airbag recall alone—the biggest auto safety recall in history—affected tens of millions of vehicles in the United States.
In the short time the FTC ruling has been in effect, at least one major auto manufacturer has loosened its standards regarding its used car sales advertising. One small private dealer (presumably a moral “lone wolf”) refuses to sell any used vehicles with a known unrepaired safety recall issue the fact, but his business may not survive that practice as open recall trade-in vehicles are piling up in his lot.
It is imperative when buying a used car, that you know and understand the safety status of the vehicle you’re considering purchasing. If possible, bring your own mechanic to inspect the car before you buy it. Use the VIN to check SaferCar.gov for free to see if the vehicle is subject to any outstanding safety recalls. You can also check for auto recalls here.
If you suspect you have been the victim of dealer fraud, The Law Offices of Timothy A. Abeel can help. Our practice is exclusively dedicated to lemon law, breach of warranty, and dealer fraud claims. Call 888-611-5481 for a free case review today.