AG sues 390 Auto Group in Poconos for selling defective used cars

A Monroe County auto dealership is accused of false advertising and knowingly selling vehicles that had major operational issues.

Attorney General Michelle Henry's office announced a lawsuit Wednesday against Mountainhome-based 390 Auto Group, LLC, and its owner, Elias Baladi of Stroudsburg, for selling vehicles under false pretenses.

The business address was 1100 Route 390, Cresco. As of Thursday morning, the business appeared closed and all signs representing 390 Auto Group had been taken down.

“This is every used car buyer’s worst fear – paying thousands of dollars and realizing soon after that the vehicle is unusable,” Henry said. “People and families depend on reliable vehicles to get them to work, school, medical appointments, and grocery stores, among other destinations, and it is my duty to protect hard-working Pennsylvanians from being swindled.”

The lawsuit filed against 390 Auto and Baladi claims the dealership advertised and misled consumers into believing they were purchasing “quality automobiles at the best price possible.” It's also alleged to have made misrepresentations about the availability of vehicles and failed to use compliant written agreements.

The AG's office said "in reality, numerous purchased vehicles were unreliable, did not pass inspection, and had serious engine and transmission problems."

According to Pennsylvania law, dealerships are required to disclose any known defects even if they are sold "as is." It prohibits dealerships from selling cars they knew, or should have known, had major problems that would cause the vehicle to fail state inspection.

The AG included consumer online reviews and consumer complaints they received in the lawsuit and claimed "Defendants’ business practices indicate a pattern and practice of deceptive and unfair business practices."

Examples of the allegations in the lawsuit, some of which came from citizens 60 years or older, against 390 Auto Group and Baladi include:

• Defendants failed to provide the consumer with the vehicle they originally purchased, kept the consumer’s deposit, and failed to issue a refund of the down payment.

• Defendants purposely omitted the trade-in value of vehicle for their financial benefit, which caused the consumer to incur a higher loan payment.

• Defendants guaranteed the consumer that they would inspect the vehicle. When the consumer picked up the vehicle, it was discovered that it did not have third-row seating as promised and was not inspected, as the mechanic quit and the consumer had to take the vehicle to a third-party mechanic. As a result, the consumer drove the vehicle to the third-party mechanic and was notified that the vehicle sold by the defendants cannot pass state inspection.

• After a consumer purchased a vehicle and was driving it home, the transmission began to slip. The consumer contacted the defendants, and they responded that it was the consumer’s fault. The consumer took the vehicle to a third-party mechanic, who informed the consumer that the vehicle had issues with the transmission and engine. The consumer emailed and called the defendants to inform them of the mechanical issues; they were unresponsive.

The AG's lawsuit against 390 Auto and Baladi demands that they pay restitution to all consumers that have suffered losses, permanently shut down the dealer in the state of Pennsylvania and pay civil penalties of $1,000 for each violation of the Consumer Protection Law and $3,000 for each violation involving a consumer age 60 or older.

Online reviews listed in the lawsuit included a multitude of complaints about vehicle performance after the purchase, such as bad transmissions, faulty engines, missing or faulty car parts and the inability to pass state inspections. Many of the complaints reiterate problems and issues occurring after driving off the lot or soon thereafter. A few owner responses on the reviews accuse customers of leaving fake reviews, or state that the owner does not know the customers.

Consumers who believe they or someone they know may have been a victim of 390 Auto Group can file a complaint with the Bureau of Consumer Protection online at www.attorneygeneral.gov, by calling 800-441-2555 or by emailing scams@attorneygeneral.gov.

This article originally appeared on Pocono Record: 390 Auto in Barrett Twp. sued by AG for deceptive sales practices