What to Do if You’re a Victim of Auto Dealer Fraud

A business commits consumer fraud when it uses unethical or illegal tactics to deceive a consumer into spending more than is justifiable or necessary. One of the most common types of consumer fraud is auto dealer fraud, which was the basis of almost 14,000 complaints received by the FBI from 2008 to 2010. Collectively, the victims were defrauded out of $44.5 million, which equates to an average loss of about $3,180 per person. As these figures demonstrate all too clearly, car dealer fraud is a widespread problem in the United States. Fortunately, state and federal laws against fraudulent practices give consumers a way to fight back. In this article, our Baltimore consumer fraud attorneys will explain the steps you should take if you think you’ve been a victim of auto dealer fraud or other types of consumer fraud in Maryland.

How to Report Auto Dealer Fraud in Maryland

If you suspect you’ve been defrauded by a car dealership, you should contact us quickly, and then report the fraudulent act as soon as possible by filing a complaint with the Maryland Department of Transportation, Motor Vehicle Administration (MVA).

Complaints are investigated by the MVA’s Investigative and Security Services (ISS) Division, which conducts investigations against both individuals and business entities, including automotive manufacturers, distributors, and dealers. A complaint against an auto dealer might involve one or more of the following issues:

  • Advertising
  • Contract of vehicle sale
  • Financing
  • Misrepresentation
  • Undelivered titles/tags
  • Vehicle inspections
  • Warranty service

In order to file a complaint, you will need to download and complete an Investigative Division Complaint Report (Form IS-109). The first page of the form will prompt you to supply some basic information, such as the year, make, and model of the vehicle involved. The second page provides open space to describe the issue. Print clearly, and be as detailed and precise as possible in your description of the suspected fraud. Make sure to sign your name and supply all requested contact information so that investigators can easily reach you for additional questioning.

Mail your completed complaint form to the ISS Division at the following address:

MVA
Investigation and Security Services Unit
6601 Ritchie Highway, N.E.
Glen Burnie, MD 21062

If you have any questions, you can:

  • Email the MVA at mvacs (at) mdot (dot) state (dot) md (dot) us.
  • Call the MVA at (410) 768-7000, Monday through Friday, 8:30 A.M. to 4:30 P.M.
    • If you are hearing-impaired, call the MVA at (800) 492-4575 TTY.

Know Your Rights Under Federal Consumer Protection Laws

Maryland’s consumer protection laws are bolstered by additional federal legislation. Some of the most important federal consumer protection laws include, but are not limited to, the following:

  • Fair Credit Billing Act (FCBA) – The FCBA is enforced by the Federal Trade Commission (FTC). It protects consumers against:
    • Being charged for items you never received.
    • Being charged more than once for the same product or service.
    • Payments not being credited to your account.
  • Fair Credit Reporting Act (FCRA) – Codified at 15 U.S.C. § 1681, the FCRA was designed to “promote the accuracy, fairness, and privacy of information in the files of consumer reporting agencies,” including the major credit reporting agencies (Equifax, Experian, and TransUnion). The FCRA guarantees numerous rights, including:
    • The right to know if the information in your file is being used against you (e.g. for purposes of denying a job or credit application).
    • The right to dispute incomplete or inaccurate information.
    • The right to seek damages (compensation) from entities which violate your rights under the FCRA.
  • Fair Debt Collection Practices Act (FDCPA) – Codified at 15 U.S.C. § 1601, the FDCPA prevents creditor harassment by banning debt collection practices deemed abusive, such as calling after 9:00 P.M., threatening legal action, or calling a consumer at his or her workplace. It also requires creditors to follow certain rules, such as providing debt verification at the consumer’s request.
    • Please note the FDCPA regulates only the collection of consumer debt, not commercial debt collection.
  • Federal Trade Commission Act (FTC Act) – The FTC Act created the FTC in 1913. The Act authorizes the FTC to “prevent unfair… or deceptive acts or practices in or affecting commerce.” Acts are considered “deceptive” when they are both (1) misleading to the average consumer, and (2) likely to impact a consumer’s decision to purchase a product. This second criteria is known as “materiality” (significance).
    • Some common examples of deceptive practices include not honoring warranties, failing to disclose important pricing information to buyers, and resorting to “bait-and-switch” techniques, in which the seller “baits” the consumer with misleading advertisements for a product or service which isn’t available. The consumer is instead referred to a similar, but more expensive product or service, and is thus deceived into spending more than the original advertisement stated.
    • Critically, the Act also authorizes the FTC to “seek monetary redress and other relief for conduct injurious to consumers” – in other words, compensation for consumer fraud.

You might also be interested in exploring the U.S. Consumer Product Safety Commission website. The CPSC posts recall notices, offers safety tips, provides links to various consumer protection laws, and more.

If you think you were a victim of auto dealer fraud or other forms of consumer fraud in Baltimore or the surrounding counties, you may have a right to compensation. Call the fraud lawyers of Whitney, LLP at (410) 583-8000 today to set up a free and confidential legal consultation.

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