Executives of a automobile service contract vendor have agreed to lifetime bans from the trade and a suspended $6.5 million judgment to settle allegations that their “prolonged vehicle guarantee” telemarketing misrepresented their protection and violated the Do Not Name registry, the Federal Commerce Fee mentioned.
Tony Gonzalez, his brother Charles Gonzalez, the joint service contract firms American Car Safety and CG3 Options — which does enterprise as My Safety Plan — and the Tony Gonzalez Consulting Group additionally agreed to a lifetime ban on telemarketing underneath the settlement introduced March 24 by the FTC.
“AVP misled customers about who they had been and what they had been promoting,” FTC Bureau of Client Director Samuel Levine mentioned in a press release March 24.
Neither Gonzalez brother nor any of the businesses denied or admitted any wrongdoing underneath the settlement. Emails to their attorneys searching for remark haven’t been returned.
The FTC mentioned the group tricked customers out of hundreds of thousands of {dollars} in a scheme courting again to 2018.
The majority of the defendants’ $6.5 million judgment will stay suspended so long as they adjust to the settlement’s phrases, however each brothers should nonetheless make some funds to the company.
Charles Gonzalez was required to pay $3,000 to the FTC, whereas Tony Gonzalez was required to present the company the contents of two financial institution accounts and the proceeds from promoting Cartier and Breitling watches.
The FTC in a February 2022 grievance accused the brothers and corporations of a single depend of misleading representations in violation of the Federal Commerce Fee Act. The defendants additionally had confronted single counts of violating the Telemarketing Gross sales Rule by misrepresenting an affiliation, misrepresenting traits of an excellent, misrepresenting a refund, remotely creating funds tied to telemarketing, calls violating the Do Not Name registry and failing to pay the registry’s price.
The FTC alleged the defendants’ telemarketing scripts failed to say the precise automobile safety firm names and as an alternative represented the caller as being from “seller companies” of the producer or dealership related to the shopper’s automotive.
Callers instructed prospects excited by extra automobile protection that they’d be transferred to a specialist in that model, the FTC mentioned.
“Then these specialists make extra misrepresentations that AVP is affiliated with an vehicle seller or producer, equivalent to ‘I’m from Ford,’ ” the FTC wrote within the grievance.
The company additionally accused the defendants of declaring service contracts with many protection exceptions supplied equivalent to “bumper-to-bumper protection” or “full automobile protection.”
The gross sales pitch additionally promised a refund if the guarantee was canceled in 30 days, however the defendants failed to offer these refunds when requested, left calls and messages unanswered and broke guarantees that refunds had been coming, the FTC mentioned.
The settlement follows a December 2022 Federal Communications Fee plan to high quality 10 firms a report $300 million collectively for “the most important robocall operation the FCC has ever investigated.” The roughly 5.19 billion unlawful robocalls made by the companies between January and March 2021 tried to promote automobile service contracts to customers, the FCC mentioned. In July 2022, the FCC instructed telecom suppliers they might block calls from sure voice service suppliers allegedly used for that robocalling, a transfer that the software program supplier Robokiller mentioned produced “spectacular” ends in eliminating service contract calls.
