RALEIGH, N.C. (Legal Newsline) - North Carolina Attorney General Roy Cooper announced on Tuesday that he has halted the operation of a telemarketer that was allegedly misleading customers about auto warranties.
Automotive Protection of New Jersey allegedly used illegal telemarketing calls to trick seniors and other vehicle owners into buying warranties that were seemingly worthless.
Cooper alleged that Automotive Protection targeted those 65 years of age or older and often called people who were registered with the Do Not Call Registry. The company's telemarketers allegedly pretended to represent car manufacturers and claimed to sell auto service contracts that offered bumper-to-bumper protection.
Although consumers were told they could cancel the contracts, those that tried were usually unsuccessful, Cooper says. Automotive Protection allegedly gave out the wrong contact information, refused to answer the phone or return consumers' messages, and claimed that they didn't receive the cancellation notices.
Cooper received 25 complaints about the company and its sales practices, resulting in his filing a lawsuit against the company and Christopher Doyle, its manager, in 2009.
"Each week, we hear from people who aren't getting their money's worth from auto service contracts," Cooper said. "We're watching this industry closely to protect North Carolina drivers."
The judgment bars the company from selling or pitching auto service contracts in the state. The company must also allow any consumer who purchased a warranty the option to cancel it.
Additionally, Automotive Protection and Doyle are required to pay $4.5 million in civil penalties that are earmarked for public schools in the state.
Cooper has won two similar cases in the past few months. In November, he reached an agreement with the individuals who ran U.S. Fidelis, the nation's number one seller of car service contracts. In December, Credexx and its owner were banned from doing business in the state.
"Think twice before you respond to a pitch for an auto service contract," Cooper said. "Do your own research to see if you really want or need extra warranty coverage. Don't just take the sellers' word for it."