Faulkner Honda recently reached a settlement that includes restitution for consumers for what Pennsylvania attorney general Josh Shapiro described as deceptive and unfair sales of a “valueless” warranty product.
According to a news release, an investigation by the attorney general’s Bureau of Consumer Protection revealed the dealership that’s a part of Paxton Associates deceptively marketed, negotiated and sold “valueless” dealership warranties to customers “for a certain period of time.” Consumers paid about $1,000 on average for these warranties, which catered to consumers entering into short-term lease agreements for new vehicles and “had no meaningful value beyond the manufacturer’s warranty that was already included in the advertised purchase price.”
Shapiro explained this activity was in violation of the Automotive Industry Trade Practices regulations and the Pennsylvania Consumer Protection law.
“This dealership took its customers for a ride by encouraging them to purchase an additional warranty that had no value,” Shapiro said. “My office is fighting to ensure that consumers are able to make informed purchases and protect against deceptive sales tactics, which bilk customers out of their hard-earned money.
If you were a customer of the Faulkner Honda dealership and believe you have been a victim of this deceptive sales tactic, you may be eligible for restitution and should contact my office,” he continued.
The Keystone State AG noted Faulkner Honda sells new vehicles that come with a standard manufacturer’s warranty of 36 months or 36,000 miles. During the later stages of the sales transaction, Shapiro said the dealership offered and sold an additional dealership warranty — the New Vehicle Coverage Warranty — for new Honda vehicles purchased or leased.
Shapiro said his office found for new Honda vehicles leased for a term of 36 months, the Faulkner Honda warranty failed to provide any “meaningful value particularly considering the amount of money paid by the customer.”
He added the investigation also revealed that Faulkner Honda failed to disclose this information on occasion, impairing the customers’ ability to make an informed decision regarding a valueless add on warranty product during the back end of a sales transaction.
As part of the assurance of voluntary compliance settlement, Faulkner Honda has agreed to pay restitution for eligible consumers who were affected, according to Shapiro.