Different Types of Auto Dealer Fraud

Different Types of Auto Dealer Fraud

If you are considering purchasing a vehicle in the State of California, you have the right to receive a vehicle free from mechanical issues, safety problems or that will break down immediately as you drive it off of the car lot. Learning more about your legal rights can help ensure that you remain protected as a consumer in California. The following article will provide information regarding the different ways that a car dealer may attempt to fraudulently manipulate a consumer.

Lemon Laundering

California Lemon Laws are specific and attempt to protect consumers purchasing vehicles throughout the state. One of the ways that an auto dealership may attempt to defraud a consumer is through lemon laundering. Lemon laundering is when a dealership purchases a known “lemon” car (a car that has defects, mechanical issues, or safety hazards) and then resells it to an unknowing and unsuspecting consumer.

Other Types of Auto Dealer Fraud

There are unfortunately other types of auto dealer fraud that can create financial harm as well as pose a danger to a consumer purchasing a vehicle. Some of the other types of auto dealer fraud include the following:

  • Inflating a Vehicle’s Price. An auto dealer has an “invoice” which is the amount that the auto dealer is charged for the vehicle by the direct manufacturer of the vehicle. In some cases, an auto dealer will make fraudulent inflations to the invoice price, which also increases the bottom line price they will charge a consumer.
  • Deceptive Advertising. In some cases, an auto dealer will lure potential consumers into the dealership through false advertising. They may advertise vehicles at a specific price and then tell the consumer that the particular vehicle advertised is now no longer available while attempting to aggressively sell the consumer a different vehicle (typically more expensive). In other cases, the car dealer will have the advertised vehicle but attempt to sell it to the consumer at a higher price.
  • Aggressive “Add-Ons.” As a consumer begins the negotiation process to purchase a vehicle with a car dealer, the car salesman may attempt to include certain add-ons (additional warranties, etc.) within the final vehicle price through deceptive practices. In some cases, they may simply attempt to include these charges without disclosing it openly to the consumer prior to the final purchase.
  • Flooded Vehicles. Car dealerships may attempt to sell flood-damaged or salvaged vehicles without disclosing that a vehicle was purchased following a flood.
  • Fraudulent “New” Cars. In other cases, a car dealership may attempt to sell a vehicle as “new” when it was actually sold new but returned to the dealership due to a safety issue or mechanical problem.
  • Trade-Ins. A car dealership may undervalue and underpay for a car buyer’s trade-in vehicle when they come in to purchase a vehicle from their dealership.
  • Rollback of Odometer. In especially unscrupulous situations, a car dealer will intentionally roll back the odometer making it appear that the vehicle has less mileage than is actually accurate.

Contact an Experienced Lemon Law Attorney Today

You have legal rights as a consumer. Always consider checking AutoCheck or CARFAX before you purchase a vehicle. However, if you believe you were the victim of auto dealer fraud, contact the experienced attorneys at Conn Law, P.C. at 412-417-2780 or online today for your free consultation, and to ensure your legal rights are protected as a consumer of a vehicle in the State of California.

July 15, 2020