In the Matter of Jim Koons Management Company, File Number 152-3104
I am an attorney who has focused on consumer-protection auto fraud cases since 1983. Our office has investigated thousands upon thousands of vehicle sales over these years, and we are deeply familiar with the real-world process of the sales of vehicles by dealers to consumers. I strongly support the detailed comments submitted to the FTC today by a long list of consumer and other public interest groups. For my own additional comments, please excuse me if I have difficulty saying temperate things here, because I find issues raised by these settlements to be astonishing, outrageous. Let me get this straight: The FTC, one of the two leading federal government agencies charged with enforcing the law to protect consumers, is on the verge of expressly allowing the defendants in these cases, and dealers in general, to sell vehicles with known safety defects (that are so substantial as to have caused mandatory safety recalls under federal law) to consumers? Taking the lead in giving cover to dealers for doing this? Effectively contradicting the central purpose of the FTC Act itself of protecting the public (not to mention honest dealers who refuse to do such things)? And undermining the many existing protections in state laws across the country against such sales? Oh, and doing this in the guise of requiring "disclosure" of the safety defects? At the bottom of which stack of papers, where the unscrupulous dealers will put which form disclaimer/"disclosure"? With the net effect of giving arguments for immunity to the selling dealers for how many injuries and deaths will later occur? (Has the FTC attempted to calculate how many can be predicted?) Honestly, the FTC staff have a choice on these three settlements: either they were incompetent in failing to see how much this "disclosure" out contradicted the FTC Act itself and existing state laws, and how much it plays into the hands of unscrupulous dealers who are only too happy to sell cars with dangerous airbags as long as they have an argument for immunity for it, or the Staff and the FTC are acting as object examples of "regulatory capture". The very least the FTC can do is delete this "disclosure" get-out-of-jail-free card from these settlements. It ought to go further and spell out the fact that it is an unfair and deceptive practice under the FTC Act itself for these vehicles to be sold for ordinary use on the roads at all - unfair and deceptive to the purchasers, to their unwitting passengers, to anyone else sharing the roads with these vehicles, and to dealers who try to compete in the used car industry without using such unfair and deceptive practices.