You’ve probably heard plenty of to-good-to-be-true offers from car dealers, but how about this one: Get out of your current loan or lease for $1.
The Federal Trade Commission says that’s what an auto dealer in suburban Dallas offered in “false or deceptive ads.”
According to the FTC’s complaint, these ads from TXVT Limited Partnership, doing business as Trophy Nissan (Trophy), violated the FTC Act as well as the Consumer Leasing Act (CLA) and Regulation M, and the Truth in Lending Act (TILA) and Regulation Z.
The FTC charged that Trophy advertised enticing prices, lease or finance terms, and promotions. They then allegedly attempted to disclaim its attractive offers using small text in print and video ads.
In addition to print and TV advertisements, Trophy also ran ads on its website, Facebook and Twitter. The dealership also ran print ads in a local Spanish-language newspaper, Al Dia.
One of the ads misled consumers into thinking they could get out of their current loan or lease for only $1.
The FTC complaint alleges the advertisement was deceptive since consumers could not get out of their loan or lease for that amount. In fact, Trophy would add the balance of any loan or lease obligation to the balance of a new loan.
In another promotion, “Max Your Tax,” Trophy claimed it would match tax refunds to use for a down payment. But the small print disclosed it limited match refunds to no more than $1,000. The FTC alleges that Trophy failed to disclose adequately the additional terms.