Scam of the day – March 31, 2017 – FTC settles yo-yo auto scam complaint

The Federal Trade Commission (FTC) has settled a complaint brought against the Sage Automotive Group of nine Los Angeles based car dealerships with Sage agreeing to pay more than 3.6 million dollars to cheated customers.

The basis for the FTC’s complaint is what is commonly called yo-yo scams which occur when a car dealer leads a consumer into thinking that the financing for the purchase of an automobile is finalized, but then later contacts the customer pressuring him or her to agree to a new financing agreement or return the car.  Making the matter worse, dealers using this deceptive and criminal tactic will often tell the customer that his or her deposit was non-refundable or that their trade-in was already sold and threaten the customer with criminal prosecution if they did not agree to the new more expensive financing terms.

Often these scams target people whose English skills may be limited and initially entice them with false advertising and  phony representations of low prices and low monthly payments.

TIPS

Whether you are a native English speaking person or not, the legalese involved in car financing and purchasing contracts can be daunting.  Make sure before you sign anything that you understand the terms of any contract and that it comports with what the dealer represented to you.  If you need to take the contracts to someone to review on your behalf, you should do so.

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