Consumers for
Auto
Reliability and
Safety

Military Seeks Protections Against
Auto Dealer Ripoffs

U.S. Secretary of the Army McHugh:

"Many of our Soldiers have fallen victim to predatory lending practices and...unscrupulous car dealerships and lenders." Read more...
 

 
U.S. Secretary of the Air Force Donley:

"...greater Government oversight of automobile financing and sales for our Airmen will help protect them and reduce unnecessary financial strain on our already overburdened Air Force families." Read more...
 

 
U.S. Department of Defense urges Congress to help protect troops

"The Department of Defense would welcome and encourage [Consumer Financial Protection Agency] CFPA protections provided to Service members and their families with regard to unscrupulous automobile sales and financing practices, provided such protections would not limit access to legitimate products. Read more...

Department of Defense Data Call summary: based on responses from 841 officers who provide financial counseling to all 4 branches of the United States Armed Forces. Read summary...
 

 
Star-spangled rip-off
Why car buyers in the military are vulnerable to bad deals

Edmunds.com report, posted Jan. 5, 2012

" ... some car salesmen who actively solicit military members and loudly praise their service nevertheless target them for rip-offs, frauds and overcharges." Read article...
 

 
Follow the Money
 
Recently Congress granted auto dealers a special exemption from being regulated by the new Consumer Financial Protection Bureau. This, despite the fact auto lending is a $850 billion business, and auto dealers are the #1 source of consumer complaints to the Better Business Bureau and state and local consumer protection agencies.

Surprise -- campaign cash played a central role in the dealers' win against consumers, including the military.

In the past two decades, auto dealers have lavished more than $25 million in campaign contributions on Congressional candidates, with 75% going to Republicans. They have repeatedly reaped rewards in return, at the expense of consumers and taxpayers. Last year, Congress gave auto dealers more than $3,000,000 in taxpayer dollars, through the "Cash for Clunkers" program -- with no strings attached to protect car buyers from predatory dealership lending. Auto dealers have also benefited from TARP and TALF and other bailout funds.

The biggest beneficiary of auto dealer campaign cash: U.S. Sen. John McCain. He has accepted more than $717,000 from auto dealers. Despite his military background, Sen. McCain turned a deaf ear to the military community, and voted to exempt auto dealers. Ironically, Arizona has some of the most high-profile cases involving auto dealers preying on troops.

Read more: auto dealers ripping off military Servicemembers

Read more: auto dealers' campaign contributions
 

 
An End to Shady Dealers
New York Times, May 11, 2010

Even the Pentagon has weighed in, insisting that automobile purchases and dealer-assisted financing should be part of any new financial legislation because low-income military people are victimized in large numbers by shady car dealers that set up shop just outside many bases. Officials say distractions caused by these bad auto deals could affect the readiness of the armed forces. Read more...
 

 
The Pentagon versus the Auto Dealers
Huffington Post, May 12, 2010

President Obama yesterday spoke out against a "special loophole" sought by the country's auto dealers... Dealers engage in "powerbooking" and "yo-yo financing...." Read more...
 

 
The Military Coalition urges the U.S. Senate to stand up for our troops against unscrupulous auto dealers

The Military Coalition is comprised of 31 nationally respected military advocacy organizations representing more than 5.5 million active duty military Servicemembers, veterans, their families and survivors. Read more...
 

 
Auto Dealers, Pentagon square off;
Increased oversight of loans fought

Detroit Free Press, April 25, 2010

"...an amendment by Kansas Sen. Sam Brownback to exempt car dealers from Dodd's bill 'will allow unscrupulous dealers to continue to take advantage of service members and their families.' 'We can't have lenders continuing to prey on our military families,' said Katie Savant, deputy director of government relations at the National Military Family Association." Read more...
 

 
New Front in Battle over Financial Regulation
Wall Street Journal, April 22, 2010

"...among the lobbyists crowding Congress are representatives of U.S. military personnel, who are in a pitched battle with America's car dealers....U..S. car dealers want to be excluded from new financial regulations...A coalition of more than 30 military organizations is urging lawmakers to resist the exclusion of the auto dealers, arguing that soldiers are being targeted by predatory lenders. The coalition says it is a problem affecting military readiness." Read more...
 

 
Cpl. William Woods on duty in Iraq
~ Cpl. William Woods on duty in Iraq
Marine Corporal William Woods served two tours of duty in Iraq as a mortarman. He is also fluent in Arabic, and served as a translator between his command and Iraqi officials.

Congress may improve protections for military members from shady auto dealers.

Huffington Post, March 14, 2010 
read more

Concerns over troops getting rooked by shady car dealers have prompted the Pentagon to get involved in the fight over a Consumer Financial Protection Agency.

The Economist, March 15, 2010 
read more

Pentagon brass want a new consumer watchdog agency to regulate auto dealers so they don’t rip off troops.

Politico, March 9, 2010
read more

Cpl. Woods with Rosemary Shahan
~ Cpl. Woods with Rosemary Shahan of C.A.R.S.
After a shady auto dealer refused to give him back his own car, Iraq war vet and Marine Corporal William Woods was without wheels since August, 2009. That made it hard for him to look for a job -- until CARS President Rosemary Shahan presented him a Valentine's Day gift of $3000 to purchase a used car. Cpl. Woods is all smiles at the Veterans of Foreign Wars in Sacramento, where he unwrapped his "new" used car. His dog Haley looks pretty happy too. But -- does she have a license to drive?

Update (July, 2010): "With his new set of wheels, Cpl. Woods found two new jobs, and was also able to drive to his younger brother's high school graduation.


CARS gives Iraq war vet Valentine's Day gift of a "new" used car, after dealer ripoff leaves him without wheels since last August.

CBS KPIX-TV Channel 5, February 12, 2010
read more

Marine Judge Advocate General (JAG) Officer describes how auto dealers scam our troops.

read more

CARS gains enactment of new law to expand protection under California's Landmark auto lemon law to military personnel stationed in CA.

Bill passes unanimously in state Assembly and Senate, is signed by Gov. Schwarzenegger.

read more

Lawsuit alleges that Dick Edwards Auto Plaza scammed soldiers "power booking" – financing phantom items.

Kansas City News,
 July 30, 2009
read more

"I love a mark in uniform: Kidnapping. Falsified documents. Hooters nights. Meet the sleazebucket car dealers who prey on our troops."

Mother Jones,
 July / August 2009
read more

Army puts Arizona dealership off-limits.

Automotive News,
 August 12, 2008
read more

Military base declares dealerships off-limits; Ex-cons threaten soldiers.

Arizona Daily Star, July 13, 2008
read more

Holidays are Open Season on Military Wallets; Auto Dealer Charges Marine $45,000 for $3,200 1995 Dodge Neon.

San Diego Union-Tribune, December 12, 2005
read more

After car breaks down, Iraq vet wages new battle -- with dealer.

Sacramento Bee, April 14, 2005
read more

Some Creditors Make Illegal Demands on Active-Duty Soldiers.

New York Times, March 28, 2005
read more

Auto scams are #1 source of consumer headaches for troops stationed in California.

Testimony by military legal officers and representative of Navy Marine Corps Relief Society
Assembly Banking and Finance Committee hearing, March 11, 2005.

read more

Car Dealers Rip Off Our Troops; Scamsters Preying On Military Families.

Dishonest repair shops, dealerships and lenders often take advantage of those in the armed services. A charity works to assist those in need.

The Los Angeles Times, April 2, 2003
read more

Marine Corps finds…
…that buying cars causes more problems than any other single financial factor, and financial problems can endanger the troops themselves, their unit, and the mission itself.

read more
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advocacy organization working to
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What's NEW?
GM recalled car repair parts -- delays put customers at risk
GM and its dealers have started to perform the safety recall repairs on over 2.6 million vehicles with ignition switches that can turn off in traffic without warning, leaving drivers unable to steer, and causing the air bags to fail to deploy in a crash. However, some owners of recalled cars are likely to experience lengthy delays while they wait for repair parts to arrive at dealerships, and have appointments scheduled for the repairs.

GM has predicted that it may take until October for some repairs to be completed. Meanwhile, CARS recommends that if you own one of the recalled vehicles, you should insist on getting a loaner car -- and check the safety recall status of the loaner car yourself, by entering the Vehicle Identification Number on the manufacturer's website, where the manufacturer provides access to safety recall information. NEVER trust a car dealer to ensure that a loaner car is safe. Auto dealers are OPPOSED to laws that would stop them from loaning out unsafe, recalled cars.

Read More:
Detroit Free Press: GM says replacement ignition switch parts arriving at dealerships
 
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Buyer beware: NEVER trust that a dealer will have the safety recall repairs performed before selling you a car that is being recalled. Dealers are so eager to make a buck, fast, they are unwilling to delay sales long enough to get the safety recall repairs done -- for FREE.

Plus -- dealers are actively opposing legislation in Washington, DC and in California that would prohibit them from renting, selling, leasing, or loaning unsafe, recalled vehicles to consumers, unless the safety recall repairs have been performed first.

CARS’ tips on how to buy a safe, reliable used car — without having to risk going to a dealer:

Top 12 used car buying tips

Dealers playing “used car roulette” with customers’ lives — and opposing legislation to make them stop

Did a dealer sell you an unsafe, recalled car? We want to hear your story. Contact CARS

 
Buyer Beware! Auto dealers' one-
sided contracts can ruin your life
Even if the dealer breaks the law, you might not be able to get justice. Forced arbitration clauses hidden in the fine print can keep you tied up for years. The dealer even gets to pick the arbitrator who hears your case. Here's what happened to a car buyer in San Diego:
Think this is outrageous? Call your member of Congress at 202-224-3121, and urge them to vote for the Arbitration Fairness Act. More about the AFA, now pending before Congress:
http://www.fairarbitrationnow.org
 
Here's what we're doing to bring
more attention to Jon's plight:
UsedCarNightmare.org
 
Used Car Nightmare logo

Jon Perz has started a new petition
on the Change.org website
 
You're invited to check it out and send a message letting Mossy Toyota know what you think.
used car nightmare petition


 
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