New Jersey Car Dealerships Required to Pay Settlement for Deceptive Business Practices

cardealerThe New Jersey Division of Consumer Affairs has obtained a settlement of $1.8 million, not including consumer restitution, from eight automobile dealerships and their two owners. The case, in which the state government was represented by the Division of Law, came after numerous customers alleged that the dealerships had engaged in a number of suspicious business practices, from failing to disclose existing mechanical problems in used cars to charging for supplemental warranties and other “after-sale items” without customers’ consent. These charges mimic previous offenses the dealership owners, who are brothers, faced in 1999, in which they were also required to pay a variety of fines.

Carmelo Giuffre of Brooklyn, New York and Ignazio Giuffre of Colts Neck, New York reportedly engaged in a variety of deceptive business practices at their car dealerships: in addition to failing to disclose used vehicle problems and adding unapproved services to cars after sales, they reportedly failed to honor negotiated or advertised vehicle prices, failed to refund deposits in a timely manner in cases of canceled sales, and took extensive time to provide customers with motor vehicle titles and registrations. The brothers also advertised cars without required information, such as vehicle identification numbers, which prevented customers from being able to check the vehicle’s history. All of the eight dealerships named in the settlement, which include a variety of popular car brands, such as Honda, Nissan, and Hyundai, belong to the Giuffre brothers.

“Shady business practices can often help businesses get ahead in the battle, however it doesn’t win the war,” says Eli Pruett,President of Bumblebee Batteries, LLC. “In business the things that count are integrity, honesty, and quality, standing by these aspects have allowed our business to be successful in the long run.”

The current settlement follows a previous agreement the defendants reached with the State of New Jersey in 1999 for similar consumer complaints. At the time, the defendants agreed to pay $450,000, which included a $250,000 compensatory fund for consumers. The prosecution argued in this case that the Giuffre brothers had violated this prior settlement.

In the new settlement, announced July 14, 2014, the defendants are required to pay $1.8 million, of which $1,733,059 will go towards civil penalties and $66,941 will reimburse the State’s investigative costs and attorneys’ fees. Additionally, the defendants are required to resolve 45 consumer complaints that have been documented with the Division of Consumer Affairs, as well as hire a State-approved compliance monitor at their own cost for two years. The monitor will ensure that the Giuffre brothers and their dealerships comply with all applicable State and federal laws, rules, and regulations, as well as their internal policies. The monitor will also review the defendant’s policies, make any recommended changes, facilitate the resolution of additional customer complaints, and make regular reports to the Division of Consumer Affairs. The Giuffre brothers are able to formally dispute any of the complaints made against them with the Division of Consumer Affairs or its Alternative Unit Dispute Resolution Unit.

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