April 30, 2010
OLYMPIA, WA – The Washington State Attorney General’s Office is driving a multistate investigation into companies that hawk pricey extended auto warranties through deceptive junk mail, illegal telemarketing robocalls and misleading TV ads. Today, the state announced lawsuits against two of the worst offenders.
“If you own a car, there’s a good chance you’ve received a phone call or official-looking postcard claiming that your auto warranty has expired or will soon,” Attorney General Rob McKenna said. “The marketing companies behind these pitches have tricked hundreds of thousands of consumers nationwide into buying expensive service contracts that often don’t cover promised repairs. Their illegal marketing practices have to stop.”
Washington and four other states filed civil lawsuits today against Credexx Corporation, of Irvine, Calif., and its president, David J. Tabb. Credexx did business as Auto One Warranty and Auto One Warranty Specialists.
Nine states are suing recently defunct U.S. Fidelis today and two additional states are expected to file suits. Additionally, several states are asking that an independent trustee be appointed to manage the company’s assets during bankruptcy proceedings.
Assistant Attorney General Mary Lobdell, with the Washington Attorney General’s Consumer Protection Division, led the investigation. It began in 2008 with 18 states and swelled to approximately 40. She said the defendants are responsible for millions of illegal mailers and telemarketing calls.
“U.S. Fidelis and Credexx created an impression that their service plans were ‘extended warranties’ provided by car manufacturers or dealers that provide ‘bumper to bumper’ coverage of all major repairs,” Lobdell said. “Unfortunately for consumers, their representations were lies.”
PARTICIPATING STATES: The following states filed suits against Credexx today in their local courts: Idaho, Kansas, Ohio, North Carolina and Washington.
These states are suing U.S. Fidelis: Iowa, Idaho, Kansas, Pennsylvania, Texas, Ohio, North Carolina, Wisconsin and Washington.
* Under federal law, a “factory warranty” or “extended warranty” can only be offered and sold by an automobile manufacturer. Other plans are called service contracts.....
click for the full press release http://atg.wa.gov/pressrelease.aspx?&id=25600