Buying or leasing a car, SUV or truck can be an exciting experience for everyone, but many consumers are victimized by fraud at the hands of unscrupulous automobile dealers. When dealers engage in deceptive and unlawful practices, however, vehicle buyers and lessees are protected by federal and state consumer protection laws.
We can also bring other legal claims and remedies to get you compensated, including claims for:
If you have been the victim of auto dealer fraud, it takes an experienced attorney to enforce your rights and get you the remedy you deserve.
In addition to our well known lemon law practice, Timothy Abeel & Associates handles automobile dealer fraud cases in New Jersey and Pennsylvania. We are well versed in all applicable consumer fraud laws and have a proven track of pursuing successful claims against dealers big and small.
If you were the target of fraud by an auto dealer, for either a NEW OR USED vehicle, we can help you recover meaningful compensation.
Common Types of Auto Dealer Fraud
Auto dealer fraud can occur at any phase of the vehicle purchase or lease process, from pre-sale advertising, to price and financing negotiations, to broken promises after the sale is completed. Some of the common types of auto dealer fraud include:
Inflating the Invoice Price
The invoice price is the amount that the manufacturer charges the dealer for a vehicle and typically forms the basis for your purchase or lease negotiation. Some dealers improperly inflate the invoice price by adding charges that were already included in the invoice price, such as so-called “destination fees.”
Bait and Switch
This is a form of deceptive or false advertising a dealer uses to entice a customer to come into the showroom by advertising a vehicle at a great price. Once the dealer has a potential buyer at the dealership, however, they claim the car is no longer available, and then aggressively try to sell or lease a more expensive car. Other versions of bait and switch include:
- A dealer trying to sell an advertised vehicle at a price higher than the price stated in the ad.
- A dealer accepting a deposit on an advertised car, and then switching the customer into a higher-priced car.
Visit our Resource page for tips on detecting bait and switch.
This type of fraud happens when a dealer fails to disclose certain optional “add-ons” during the negotiation—such as warranties and prepaid service/maintenance programs—or doesn’t explain the cost of these add-ons. The add-ons are then slipped into the purchase/lease contract and included in the final price.
Fraudulent practices around vehicle loans occur in a variety of ways. So-called yo-yo financing happens when an auto dealer tells the buyer after he/she makes a down payment that the credit application has been approved on certain payment and interest terms. After the buyer takes the car home, the dealer calls several days later to tell the consumer that there was a last-minute problem and the loan wasn’t approved. The dealer then tries to force the consumer to sign a new purchase contract with less favorable terms and at a higher interest rate.
Prior Accidents/Flood Damage
State laws require dealers to disclose to potential buyers certain facts about vehicles that are sold with a history. A version of fraud happens in used car sales when a dealer doesn’t tell the buyer that a vehicle was designated as “salvaged” following a serious accident or after it was damaged in a flood.
Visit our Resource page, to learn more about your rights if you purchased a vehicle with a checkered history.
Used car dealers often “rollback” odometers to conceal the vehicle’s actual mileage. Using various methods, instrument readings on a vehicle can be altered or changed to make it appear as if the mileage total is lower and the vehicle is “younger” than it actually is. Odometer rollback is illegal under the Federal Odometer Act and sellers can also be held liable under applicable state consumer fraud laws.
Visit our Resource page to learn about the various rollback methods used by unscrupulous dealers and some helpful tips for detecting rollback.
Auto dealers often use several sketchy tactics when car buyers seek to trade in a vehicle as part of a purchase or lease transaction. In one scenario, a dealer will offer a price for the trade-in that is lower than the actual wholesale price, or purposely understates the vehicle’s value. The dealer’s goal is to induce the customer to negotiate the trade-in price until they agree on an amount that is still lower than wholesale, while not focusing on the cost and terms of the new car purchase.
Other common trade-in scams include:
- Overvaluing the Trade-In Vehicle/Raising Price of New Car: The dealer gives the customer a quote for an old car that is higher than its actual market value, or an overestimation. The dealer wants the buyer to commit to a trade-in AND buy a new car at the dealership. But there are strings attached — the buyer ends up being penalized by the higher trade-in value because the dealer raises the price of the new car. Even worse, the buyer not only pays a bigger purchase price, but also incurs additional finance charges because the resulting car loan is bigger.
- Refinancing the Loan on the Trade-In Vehicle: The trickiest scam involves a dealer promising to pay off an existing loan when the consumer trades in an old vehicle to buy another, no matter how much is still owed on the trade-in. This often happens when the loan balance is higher than the car’s value. Dealers include the payoff amount in the new car loan which increases the monthly payments by adding principal and interest. The new loan may have a higher interest rate than the old loan, forcing the buyer to pay more for the old car than the original loan contemplated. While such offers may be legitimate, federal law requires dealers to inform buyers that the unpaid balance of the old loan will be folded into the new loan.
New Dealer Return Fraud
New dealer return fraud happens when a dealer misrepresents that a vehicle is new, when in reality it has been returned to the dealership because of a defect or persistent mechanical problem. This is a form of what the law calls an affirmative misrepresentation intended to mislead a consumer.
In addition to the types of fraud described above, auto dealers commit deception and misrepresent the condition of their vehicles in a variety of other ways, such as claiming vehicles are certified pre-owned when they lack that certification, altering vehicle paperwork, failing to provide vehicle paperwork, and other shady practices.
Remedies for Auto Dealer Fraud
If you have been the victim of auto dealer fraud in New Jersey or Pennsylvania, you have powerful remedies under federal and state consumer fraud laws to enforce your rights. At Timothy Abeel & Associates, our experienced auto dealer fraud attorneys can help you navigate the legal process.
For example, under federal law, victims may be awarded damages for the reduced value and resale value of the vehicle, increased finance charges, insurance charges, taxes, plus reimbursement for reasonable attorneys’ fees and costs. The applicable state consumer fraud laws in New Jersey and Pennsylvania can provide additional remedies and compensation.
How We Handle Dealer Fraud Cases
We have a well-earned reputation for holding auto dealers accountable for fraudulent practices and helping our clients obtain the compensation they deserve.
- We will conduct a thorough evaluation of the facts of your case and carefully explain your rights as a consumer and your various options for achieving a good result.
- Depending on the circumstances, you may be able to recover damages up to three times the amount of your actual losses plus reasonable attorneys’ fees and costs.
- YOU WILL NEVER BE RESPONSIBLE FOR ATTORNEYS’ FEES AND OUR OTHER EXPENSES UNLESS WE SUCCESSFULLY RESOLVE YOUR CASE AND GET YOU COMPENSATION.
- Before taking formal legal action, we may contact the dealer in writing and demand that the dealer and/or manufacturer correct the problem.
- If the dealer fails or refuses to resolve your issue to our satisfaction, we may also notify the state division of consumer affairs, especially because auto dealers that engage in fraud usually have a long, documented history of deceptive practices.
- If none of these strategies get you the compensation you deserve, our experienced attorneys have the knowledge and skill to pursue a lawsuit on your behalf under all applicable state and federal laws.
Dealer Fraud Cases Simplified
Timothy Abeel & Associates makes it easy to file a Dealer Fraud claim in Pennsylvania, New Jersey, Ohio, or California. No matter where you live in these states, we will:
Conduct a thorough evaluation of the facts
Resolve your issue or pursue a lawsuit
Recover damages up to three times the amount of your losses
If none of these strategies get you the compensation you deserve, our experienced attorneys have the knowledge and skill to pursue a lawsuit on your behalf under all applicable state and federal laws.
Timothy Abeel & Associates Protects Car Buyers
At Timothy Abeel & Associates, we believe consumers have a right to be treated fairly and that auto dealers who engage in deceptive and unlawful practices must be held accountable. We have extensive experience in all aspects of consumer law and a well-earned reputation for successfully fighting for our clients’ rights. If you or someone you know has been the victim of auto dealer fraud, call our office today at 888.830.1474 for a free consultation or complete the contact form on our website. Someone on our friendly staff will respond to you promptly.