Huntington Honda and two Westchester new car dealerships owned by the same company have agreed to reimburse customers and pay a fine to settle state allegations of deceptively charging them for identity theft and credit repair services, the state said Thursday.
The dealerships, which Attorney General Eric T. Schneiderman’s office said are owned by Huntington Honda Inc., are to pay a total of $270,950 in restitution to customers and $30,000 in penalties.
None of the dealerships admitted wrongdoing but they agreed not to violate laws requiring that such add-ons be specified in writing to consumers, including their costs.Do your homeworkCar reviews, researchResearchFind a car dealerSee alsoSell your car
Schneiderman charged that, between 2011 and 2014, the three sold credit and identity theft protection for $800 or more “without in certain instances itemizing or informing customers of the price of the plan and, in certain instances after affirmatively misleading customers into believing the plan was free or ‘came included’ with the vehicle,” according to the “assurance of discontinuance” that settled the case.
The three sold a total of 475 credit protection plans for a total of $365,950 in advance fees, according to the assurance of discontinuance.
An attorney handling the case for Huntington Honda did not return telephone calls Thursday and Friday seeking comment, nor did executives at the dealership in Huntington.
Schneiderman said the credit and identity theft protection was purchased by dealers from Credit Forget It Inc., a New York company that Schneiderman’s office has shut down. It is a violation of state and federal law to charge upfront fees for services that promise to help consumers restore or improve their credit, and contracts that violate the law are void, Schneiderman said.
His announcement Thursday said three other dealer groups, in Brooklyn, Queens and Staten Island, also agreed to fines.
“Consumers deserve to be treated honestly by car dealerships, and shouldn’t be hit with hidden fees that inflate the price of the vehicle,” Schneiderman said in the statement.
The actions are the latest in an investigation begun last year into a practice in which consumers are deceived into purchasing after-sale items they don’t want, such as identity theft and credit repair services, extended service contracts, glass coating and security systems.