Framingham car dealer to pay $750K over deceptive practices

Photo | SHNS Massachusetts Attorney General Maura Healey

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By Thomas Grillo

A Framingham used car dealership has agreed to a $925,000 judgment, including restitution to consumers, to resolve allegations the business engaged in unfair and deceptive sales practices violating Massachusetts consumer protection law, according to the Massachusetts Attorney General Maura Healey.

Healey's complaint, filed with a consent judgment entered in Middlesex Superior Court last week, said New England AutoMax Inc., AutoMax Preowned Inc., and Auto Max Inc., and their owner Howard Wilner allegedly violated the Massachusetts Consumer Protection Act by misrepresenting important information about the condition, origin, and history of used cars it sold, selling add-on service contracts to consumers that did not cover the cars they were purchasing, falsifying down payments, and adding undisclosed fees onto car sales transactions.

“AutoMax and its owner purposely kept their customers in the dark about the condition and history of the cars they sold and charged customers illegal and unnecessary fees,” said Healey in a statement. “As a result of this settlement, customers who were misled by AutoMax will get money back and the company will stop its illegal practices.”

Healey’s office launched its investigation after receiving several complaints about unfair sales practices at AutoMax, including selling cars with invalid add-on warranties and padding sales with undisclosed fees or charges. The AG alleges the company and its owner engaged in unfair and deceptive acts, including:

Failing to comply with mandatory requirements to disclose when cars were previously used as a lease, rental, or taxis in ads and on purchase contracts.
Misrepresenting that cars manufactured for the Canadian market were covered by a manufacturer’s warranty and selling additional add-on service contracts at a cost of up to $3,000 that were invalid due to the foreign origin of the cars.
Adding hidden charges of $100 to $200 for customers seeking to trade in vehicles and payoff their existing loan as part of a sale.
Falsifying down payments on financing applications.
Charging document preparation fees for the preparation of documents that the company used to implement its deceptive schemes.

Under the terms of the consent judgment, AutoMax and Wilner will pay $750,000 in restitution for affected consumers and agreed to comply with prior use disclosure regulations, disclose the foreign origin of the cars they sell and the implications on any warranty or add-on products, and ensure accuracy when completing consumer loan applications.

The business is prohibited from charging customers undisclosed or inflated fees. Additionally, the consent judgment includes a $175,000 suspended penalty for any violation of the settlement’s injunctive terms within three years.

Massachusetts consumer protection law requires used auto dealers to disclose prior use as a lease, rental, or taxicab on the purchase contract for all automobiles and in ads. Used auto dealers must disclose all information impacting a consumer’s decision to purchase a vehicle, and dealers have a duty to be transparent with consumers about the terms of a deal or sale.