A Louisiana marketing company whose promotion packages advertised quick deals at bargain prices for used-car sales events in Iowa was charged by that state's officials with deceptive advertising.
Smart Automotive Group, LLC, faces up to $40,000 in civil penalties for violating the Consumer Fraud Act with "false-premise" ads. In addition, the order includes provisions for paying customers back, and agreeing to stop.
The marketing group allegedly advertised rare, low prices for used automobiles using terms such as "Seized and Repossessed Vehicle Event," "Statewide Used Vehicle Liquidation," "Emergency Disposal Event," and others, while not disclosing the retail value of the cars, says a lawsuit filed Friday by Iowa Attorney General Tom Miller.
Other complaints about the company's advertising practices included scratch-off prize cards intending to lure people into visiting Iowa used-car dealerships for sales events.
This isn't the first time the company has faced these claims. In 2007, Joe Doyle, administrator of the Governor's Office of Consumer Affairs in Georgia, issued Smart Automotive civil penalty orders of $1.66 million each for owners Michael Burst and Ben Burst in Georgia.
Consumer Ally placed three phone calls to Smart Automotive but could not reach anyone for comment.
Company faces fine for shady used car sales tactics in Iowa