Dealer To Pay $74,000 Settlement Over Mailer ‘Scare Tactics’

January 19, 2016 0 Comments

An FCA dealership will have to pay tens of thousands of dollars after the state government decided the dealership sent out mailers, which employed “scare tactics.”

Rairdon’s Dodge Chrysler Jeep in Kirkland, Washington is being forced to pay a $74,000 settlement over their mailers. Bob Ferguson, the Washington state attorney general investigated the dealership, finding that they sent out mailers, which closely mimicked official automaker recall notices.

In a statement on the state AG website Ferguson declared, “I will not tolerate a business driving sales by using scare tactics to dupe consumers into thinking their car has a safety problem. Advertising needs to be clear and honest. When ads mislead consumers, my office will take action to hold violators accountable.”

The allegation from the state is that in July 2014 this FCA dealer sent out 7,025 mailers, which closely resembled official documents send out by the National Highway Traffic Safety Administration. According to the state AG website, “The mailers notified recipients of possible recalls and offered to purchase their vehicles, but failed to clearly and conspicuously disclose that the offer to buy was independent from any recall notification.”

The dealership has settled with the state attorney general in the matter for $74,435.18. The legal costs include $35,125 in civil penalties and $39,310.18 in costs and attorney fees. Also part of the consent decree against the dealer is the requirement that the, “Defendant shall immediately inform all of its personnel having responsibility for sale or advertising of new or used vehicles of the terms and conditions of this consent decree.”

Have you ever heard of other state government investigations into dealership mailer programs? If you do so, what is the strategy at your store for sending out effective mail advertising?

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