$450,000.00 for you?

There is a new state fund for consumer protection, with over $450,000.00 in it that remains untapped and so far, unhelpful to consumers. The use of the fund is for situations where (like my current client, Mr. Hevelone) a consumer has traded in a vehicle on the purchase of another, expected it to be paid off as part of the deal. Then, instead of paying it off, the dealer folds, and the consumer is stuck with two car payments.

The money is sitting in the fund, not helping consumers, as the board to oversee it has yet to be appointed. See the related story @ the bay area's KGO website:

http://abclocal.go.com/kgo/story?section=news/7_on_your_side&id=6613470

Consumer buys Stolen Vehicle

This older story ended up on a positive note, as we were able to get the client all of her money back on her purchase of a stolen vehicle.

http://abclocal.go.com/kgo/story?section=news/7_on_your_side&id=5289239

Circuit City Sales?

Everywhere you look there are bargains and there are huge businesses going out of business. There is an important old adage, "buyer beware" that no longer protects those who commit a fraud on a consumer, but is sage advice still today.

The nation's second largest "box" and consumer electronics store intends to close all of its 567 remaining stores, once it gets approval from the courts.

What does that mean for the general public?
Unemployment for all of Circuit City's 30,000+ employees and huge sales, starting as early as tomorrow, Saturday, January 17, 2009.

The typical closeout sale is final, with ultimately no one to return mechandise to. That means, no refunds or exchanges, even while the stores remain open. It is also not unheard of for a retailer to "jack up" prices and then offer a huge percentage off, making the deal not quite as sweet as you may think.

Be very careful about purchasing an "extended warranty" which we call here by its legal name, a "service contract" as Circuit City will not be around to honor it and its validity is questionable at best. If it's a third party seller, do some research into that company to see if they will be around. You still should have rights against the manufacturer under the new product warranty.

I highly recommend financing any purchase, even if you intend to pay it off in a month or even a week or a few days. Most consumer finance contracts come with a federally mandated clause that makes the "holder" of the credit contract "stand in the shoes" of the seller and legally liable for any and all wrongdoings of Seller, in this case, Circuit City.

No Car payments?

Attorneys in Kansas and Missouri have sued Chad Franklin Suzuki over "ridiculous advertising claims." For seven months, the Dealer's stores bombarded local airwaves with improbable come-ons, like "Drive a different brand new Suzuki every year and never make a single car payment" - "No money down and a brand new vehicle for $43 a month, gasoline included" and "no payments for life."

One ad claimed: "Chad Franklin will make your first year's worth of payments using special factory rebates. Then if you want, Chad Franklin will pay the vehicle off, and you'll pick out another new Suzuki, and the process starts all over again and continues year after year."
The catch? The sales contracts required consumers to buy the vehicles at the normal price.

About 650 customers took advantage of the sweet deals, some from as far away as California.

Some of the swindles worked as promised for a while. Buyers signed a standard sales contract, then got a check from the dealership to cover all or part of the monthly payments. But then, in most cases, the checks stopped coming.

According to the attorneys general, a customer typically got a Suzuki to drive for a limited time, usually six to 10 months. At the end of that time, the customer was supposed to return the car and exchange it for another Suzuki, which the customer then could drive for another limited period of time at the same low price. But when the customers returned to the dealership, they allegedly were told that the promotion had ended and that they were responsible for the terms of the original contract — a standard purchase agreement.

Kansas Assistant Attorney General Emilie Burdette said the dealership made a variety of promises in the TV ads and different representations at the point of sale. One incentive allowed the consumer to take part in a "two-, three- or four-year vehicle performance test."

Nearly identical ads, have led to problems for another Suzuki dealership: Joe Gibson Suzuki, of Spartanburg, S.C.

After more than 100 consumer lawsuits were filed, Gibson filed for Chapter 11 protection in U.S. Bankruptcy Court in South Carolina on July 16. The dealership closed in August.

Back in Kansas, some customers voluntarily repossessed their cars, dropping them off at the dealership. Both attorneys general are seeking restitution for the consumers.

"We want to get consumers to a place that makes sense, given all the unique circumstances," said Burdette, the assistant attorney general in Kansas. "But there's not going to be an easy, clean solution."

Employer of the Week

A lawsuit has been brought in Fed Court in New Orleans against a Chevy Dealership alleging that if failed to discipline an employee who doused a disabled co-worker's shoes with brake fluid and set him on fire. The disabled employee has a diminished mental capacity and is wheelchair-bound with cerebral palsy. The Chevy dealer refused to report the attack to the police, and tried to bribe the victim to keep quiet.