N.Y. AG announces settlement with car dealer

NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced a settlement on Wednesday with a Westchester auto dealer that allegedly added a bogus $499 administrative fee to the purchase price of used vehicles.

N.R. Automotive Inc., doing business as New Rochelle Toyota, allegedly pre-printed the fee on the sales agreements it used near required pre-printed taxes and fees. It allegedly appeared as if the administrative fee was mandatory and non-negotiable, when it was simply tacked onto the negotiated purchase price of the vehicle.

No extra benefits or services were provided to customers in return for paying the fee.

"By charging a bogus, illusory administrative fee, New Rochelle Toyota was deceiving its customers and creating an unfair marketplace," Schneiderman said. "My office will continue to monitor this company's business practices, as well as those of other auto dealers, to ensure that they are fair and honest."

New Rochelle Toyota also allegedly engaged in false and deceptive advertising and falsely claimed it earned an A+ rating from the Better Business Bureau when its rating was actually an F.

Under the terms of the settlement, New Rochelle Toyota must repay $86,826 to 174 customers who were allegedly charged the administrative fee. The dealership must also reform its advertising practices and pay $50,000 in penalties and costs to the state.