Monday, December 15, 2014

Shocker! Auto Dealer Fined For Deceptive Radio Ads

A family-owned chain of automobile dealerships located in Iowa, Montana and South Dakota will pay a $360,000 civil penalty for running misleading ads, federal regulators announced Friday.

The Associated Press is reporting the Federal Trade Commission alleged in a complaint that 20 Billion Auto dealerships and their advertising company violated a 2012 order that prohibited them from deceptively advertising the cost of buying or leasing cars.

The commission's complaint says Billion Auto's television, radio, print and online ads routinely focus on a few attractive terms such as low monthly payments and interest rates. But the ads use fine print, distracting visuals and rapid-fire audio delivery to conceal other material terms of the deals, including that the low payments are for leases, limits on who can qualify and added costs, the commission said.

The complaint referenced one television ad that ran in Sioux Falls in 2012 promoting vehicles for lease for $179 a month. But fine print that was tiny and flashed on the screen for three seconds specified that customers had to put $2,000 down and be a military member or veteran and returning customer to get the deal.

A radio spot that ran 280 times on Sioux City radio stations advertised "the 2013 Nissan Altima for just 99 dollars a month." Then in the final seconds of the ad, the announcer says with a rapid-fire delivery that the deal is for a 36-month, 36,000 mile lease that requires a $5,000 down payment. Other ads hid in the fine print the requirements to qualify for financing deals such as a five-year loan with zero percent interest, the complaint said.

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