Cuomo issues warning to car dealers

August 10, 2009 3:59:31 PM PDT
New York's Attorney General Andrew Cuomo has a warning for some car dealers throughout the state - stop deceptive advertising for the "Cash for Clunkers" program. According to Cuomo, some advertisements for the rebate are misleading and deceptive and he has officially put them on notice to stop. Today, the office issued a cease-and-desist letter to 40 dealers regarding how they're advertising for program.

The office took action after reviewing a number of advertisements from various car dealerships that omitted significant requirements that had to be met in order for a consumer to be eligible to get the rebate. The A.G.'s office said the ads mislead consumers into believing their trade-in vehicle qualifies for the program when it doesn't, or they're eligible for thousands of dollars in rebates when they are not. The letter orders the dealers to modify the promotions and ads to clearly explain how the program works.

The "Cash for Clunkers" program provides dealerships with money to credit consumers $3,500 or $4,500 for their trade-in clunkers that may be worth a lot more. The intent of the program is to give the economy a boost and to promote clean air by getting consumers to buy more energy efficient vehicles.

"This new federal program not only allows consumers to buy new vehicles that they otherwise might not be able to afford, but creates an enormous incentive for people to choose environmentally-sound, fuel-efficient cars," said Cuomo. "This program could be a boon for both our economy and our environment, as well as provide much-needed financial assistance to consumers. Businesses that fail to advertise honestly and try to take advantage of this federal program will face legal action by my office."

The Attorney General said some advertisements by several auto dealerships aggressively promoted the program without fully disclosing its limitations, while other dealers advertised similarly named "cash for clunker" promotions that have nothing to do with the federal program. Mr. Cuomo is urging consumers to become familiar with the general requirements of "Cash for Clunkers".

  • It applies to the purchase or lease of a new vehicle;
  • The trade-in must be in drivable condition;
  • The trade-in vehicle's fuel efficiency must not exceed a combined city/highway fuel economy of 18 mpg;
  • The trade-in vehicle must have been insured, and registered to the current owner, for at least one year prior to the trade-in;
  • If a transaction falls within the CARS program, the amount credited to the consumer is $3,500 or $4,500 depending on the type of vehicle being traded in, the type of vehicle being purchased, and how much the fuel efficiency of the new vehicle exceeds that of the trade-in. For example, in the case of a passenger vehicle being traded in and a new passenger vehicle being purchased, if the new vehicle has a combined fuel efficiency of at least 4 mpg but less than 10 mpg better than the trade-in vehicle, then the credit is $3,500; if the difference is at least 10 mpg, then the credit is $4,500.
  • Dealerships must register with the National Highway Traffic Safety Administration.

    Dealerships that received cease/desist letters, include, by region:

  • New York Metro: Plaza Hyundai, Ltd.; City World Toyota; City World Hyundai
  • Nassau County: Garden City Jeep Chrysler Dodge; Hassel Volvo; Karp Volvo; Millenium Toyota and Nissan of Garden City
  • Suffolk County: Competition Toyota; Security Dodge; Town & Country Jeep; Chrysler Dodge and Atlantic of Bay Shore
  • Westchester: Smith Cairns Ford, Inc. of White Plains; Central Avenue Chrysler Jeep Dodge
  • Poughkeepsie: Healey Chevrolet; Healey Ford; Newburgh Park Motors
  • Buffalo: Basil Resale Sheridan; Basil Toyota; Cappellino Buick; Dave Smith Ford; Emerling Chevrolet; Paddock Chevrolet
  • Rochester: Lessord Chrysler Products; Bob Johnson Chevrolet
  • Syracuse: Fayetteville Dodge; Royal Nissan-Subaru; Summit Dodge
  • Binghamton/Southern Tier: Delhi Motor Company, Inc.; Gault Toyota; Miller Auto Team; Stafford Chevrolet
  • Utica: Victory Chrysler Dodge Jeep; Cooper Kia; Steet Ponte Chevrolet; Don's Superstore; Davidson Chevrolet Cadillac Buick Pontiac GMC of Rome; Carbone Nissan; Carbone Dodge Chrysler Jeep
  • Plattsburgh: Dannemora Ford; Garvey Hyundai

    Consumers may determine if a dealer is registered and get more information by going to www.cars.com or calling 866-CAR-7891. Consumers may also ascertain mpg ratings of vehicles at fueleconomy.gov

    Attorney General Cuomo urges any consumer who believes they are a victim of fraudulent or deceptive business practices to contact his office at 800-771-7755.


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