Submission Number: 00059
Received: 12/29/2011 12:03:41 PM
Commenter: Patty Anderson
Agency: Federal Trade Commission
Initiative: Public Roundtables: Protecting Consumers in the Sale and Leasing of Motor Vehicles; Project No. P104811
Attachments: No Attachments
I have a one-person law practice, dealing exclusively in consumer protection claims, dominated by auto fraud. Problems with persuing these claims include: 1. lack of education of the public; people do not know they can sue a dealership without racking up huge attorney bills, so I suspect many victims give up; 2. use of binding arbitration clauses that are never explained. Mandatory binding arbitration should be illegal in consumer transactions; the way it is handled in Magnuson-Moss Warranty Act cases is fine; 3. the use of Carfax reports to show no accidents; this is very deceptive. Any auto history report should have to have in very conspicuous language a suggestion that a buyer should first have a mechanic or body shop look at the car, and that the report itself or a representation by the seller that the report is accurate does not mean there have not been any accidents; 4. forum selection clauses should not be allowed in individual consumer transactions-- RV manufactureres all use Indiana, for example, when every part of the transaction and repairs happened in the state of purchase. I had one fraudulent sales promotion that issued a coupon for $10,000, to be collected 39 months later. Every part of the transaction happened in Virginia, but the coupon said in fine print on the reverse that the jurisdiction for any suit was to be Texas, and Texas law would apply. The judge here enforced that, so I sued in Texas; 5. yo-yo transactions are commmon, and the dealerships keep down payments that are often the only cash a buyer has. These can be small dealerships that close their doors when sued. There are useful laws already in place, but again the population doesn't know they have legal recourse. In Virginia, language is on the contract that says that if financing is denied the consumer gets the down payment back, but it needs to include a reference to where to go to get help if the dealer refuses to return a down payment (or simply do away with these sales and make the dealers honor their contracts).