AG's Office Settles Case Against Olympia Car Dealer

Olympia -July 27, 2000- An Olympia car dealer accused of unfair and deceptive sales practices will pay $75,000 in fees and penalties and be required to make restitution to consumers victimized by its practices, Washington Attorney General Christine Gregoire said today.

Capitol Car Centers and its owner Daniel A. Kirby agreed to pay the fees, penalties and restitution in a consent decree filed today in Thurston County Superior Court. The dealership and a former general sales manager, David Leger, also agreed to not engage in deceptive practices in the future. The consent decree settles a lawsuit also filed today by Gregoire’s office.

"The restitution and penalties required by this settlement should serve as a reminder to car dealers throughout Washington that consumer-friendly advertising must be accompanied by actual business practices that are non-deceptive and honest," Gregoire said.

According to the lawsuit, the auto dealership allegedly engaged in "loan packing," a practice in which dealers deliberately overstate a consumer’s monthly car-purchase payment by including optional services such as extended service contracts and undercoating. Many consumers aren’t aware that the extra services are optional and that refusing them could lower the monthly payment needed to finance the transaction.

In one case, one of the dealership’s customers didn’t even know he’d purchased an extended warranty – and paid about $1,900 extra for it.

The Attorney General’s Office has played a lead role nationally in the fight against loan packing and helped push through a National Association of Attorneys General resolution condemning the practice.

Under the settlement, 81 customers who an investigation revealed may have been victims of loan packing since June 8, 1998 must be notified by Capitol Car Centers that they may be eligible for refunds. There may be more victims, and others who file "packing" complaints with the Attorney General or Better Business Bureau within 60 days will also be eligible for the claims procedure.

Consumers seeking the refunds have until Sept. 25, 2000 to file a refund claim with either the dealer, the Attorney General’s Office, the Better Business Bureau, the Insurance Commissioner’s office, or any law enforcement agency.

For an electronic version of this press release, visit the Attorney General’s webpage at https://www.atg.wa.gov

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