Report: 1500 Known Complaints To The FTC Against CarMax Since 2011

Several news outlets have reported that 11 consumer groups have filed a petition to the Federal Trade Commission against CarMax for what they claim is deception in their advertising. Of the 238,198 complaints against car dealerships since 2011, 1,500 of them were against CarMax. That figure is in addition to 802 against CarMax via Better Business Bureau. Complaints against auto dealers across the board is on the rise and the consumer groups in particular want the federal government to look into CarMax.

The main reason for their petition is they feel that CarMax is being deceptive. The company promotes its 125 point inspection on every car that it sells, however, they don’t check to see if vehicles have been repaired or recalled, something that they aren’t legally required to do for used vehicles.

This point was raised by Democratic Senator Chuck Schumer back in June of this year. In a letter to Edith Ramirez, head of the FTC, Schumer expressed , “grave concern over reports that used-car dealers are selling cars subject to recall for safety-related defects, while at the same time representing to consumers that those used vehicles have passed rigorous safety inspection.”

This inquiry isn’t an issue that CarMax is taking lightly. In a press release on the official CarMax website, it was explained, among other things that, “we encourage customers to register their vehicle with the manufacturer as soon as they make a purchase.” They went on to note that they have long supported federal legislation on this issue. The release further explained that, the legislation should require manufacturers to give used auto retailers all recall information, the same diagnostic and repair information and the tools and parts that manufacturers make available to their franchise dealers.”

What are the possible outcomes of the current system in place that could lead to more negative reviews via the FTC or BBB? The New York Times documented an incident in which a woman had purchased a vehicle in early 2014 from a CarMax store. She contacted the manufacturer to see how she could connect her Bluetooth. Upon providing the VIN number, she was told that her vehicle had been recalled in 2013 due to a recall in which her rear axle could seize up.

How can that type of situation be avoided moving forward? Is federal legislation the best solution to this problem? Dealerships are not required by law to look into and provide customers with info on all recalls. What do you think, what can be done to prevent more complaints and further consumer distrust of car dealerships?