A car dealership in Illinois has agreed to pay $10 million in a settlement with the Federal Trade Commission (FTC) and the state’s attorney general’s office, according to WSOC-TV. The dealership, Ed Napleton Automotive, allegedly up-charged Black customers more for their purchases.
FTC takes action against multistate auto dealer Napleton for sneaking illegal junk fees onto bills and discriminating against Black consumers. Napleton Auto will pay a record-setting $10 million in case brought jointly with the State of Illinois: https://t.co/WSKFrQrTKY
— FTC (@FTC) April 1, 2022
The agreement, which was announced on Friday, was filed with a compliant in Chicago federal court. That compliant accused the Napleton group, which has 51 dealerships across eight states, of charging customers “hundreds of thousands of dollars” for additional products like “paint protection” without their permission, the Chicago Tribune reports.
The compliant also says the dealership discriminated against Black customers, charging them $99 more for add-ons and almost $200 more in interest. According to the Tribune, it names eight dealerships as defendants, including Ed Napleton Elmhurst Imports and Napleton’s Arlington Heights Motors.
“Working closely with the Illinois Attorney General, we are holding these dealerships accountable for discriminating against minority consumers and sneaking junk fees onto people’s bills,” director of the FTC’s Bureau of Consumer Protection Samuel Levine said in a press release. “Especially as families struggle with rising car prices, dealerships that cheat their customers can expect to hear from us.”
In response to the announcement of the settlement, the Napleton group issued a statement denying any wrongdoing, WSOC-TV reports.
“The Ed Napleton Dealership Group has resolved disputed claims made by the Federal Trade Commission and the Illinois Attorney General’s office,” a spokesperson for the Napleton group said. “We made this decision to avoid the disruption of an ongoing dispute with the government. As a result, we reluctantly determined that it was in our best long-term business interests to resolve these matters.”
It’s a landmark judgement for an FTC auto lending case, the Tribune reports. Funds from the settlement will be used to compensate Napleton consumers, while $50,000 will be allocated to a special fund to the Illinois attorney general’s office for law enforcement and public education.