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Auto Dealer Fraud

Buying a car can be a fun and exciting experience. Unfortunately, sometimes that experience can turn into a nightmare, if it turns out that the car dealer acted in a fraudulent manner. Auto dealer fraud describes deceptive and unlawful practices used by automobile dealers. This type of fraud can occur at any stage of the vehicle purchase process, from advertising to negotiation of vehicle pricing and financing terms. FindLaw's Auto Dealer Fraud section provides information about the types of auto dealer fraud as well as tips for buying a used car. In this section, you can also find frequently asked questions about auto dealer fraud as well as how to enforce your rights if you are the victim of this type of fraud.

Common Types of Auto Dealer Fraud

There are various ways that an auto dealer can commit fraud. One common situation is improperly inflating a vehicle's invoice price. The invoice price refers to the amount that the manufacturer charged the dealer for the vehicle. An example of an improper inflation of the invoice price would be to make additions to the invoice figure even though those charges were originally included in the invoice price.

Another example of auto dealer fraud is the bait and switch. This occurs when a car dealer lures a customer to the dealership by advertising one car at a certain price, but then says that car is no longer available. Instead, the dealer uses aggressive tactics to sell a different, more expensive vehicle. A bait and switch can also occur if the dealer tries to sell the advertised vehicle at a price higher than what was advertised.

There are many other ways an auto dealer can commit fraud. The best way to defend yourself against auto dealer fraud is to be a well-informed consumer. Researching the car and the dealership is a good way to become well-informed and can help you avoid becoming the victim of fraud. It's also good to read and understand any documents the dealer asks you to sign.

Enforcing Your Rights

There are a number of steps you can take to enforce your legal rights in the event of auto dealer fraud. One step a person can take if he or she is the victim of auto dealer fraud is to contact the dealer. In fact, many states require a person to contact the dealer and give the dealer an opportunity to correct the problem before he or she can file a lawsuit. It's important to contact the dealer in writing and express both the problem and what you would like the dealer to do to fix the problem.

A victim of auto dealer fraud also has the option of filing a complaint with the state agency that protects consumers' rights in connection with vehicle purchases. In some states, the agency might be a consumer protection division of the state attorney general's office. In other states, the agency could be a separate agency that is specifically designed to handle auto dealer complaints.

Hiring a Consumer Attorney

If you think you might have been the victim of auto dealer fraud, you may want to contact an attorney to discuss your legal options. An attorney can help you determine if the dealer's actions were in fact fraudulent. The attorney can also advise you on the best course of action for your particular circumstances.

Learn About Auto Dealer Fraud