{"id":9198,"date":"2024-07-02T08:00:00","date_gmt":"2024-07-02T12:00:00","guid":{"rendered":"https:\/\/tvdelmarva.com\/?p=9198"},"modified":"2024-07-02T16:13:50","modified_gmt":"2024-07-02T20:13:50","slug":"ftc-takes-action-against-online-used-car-dealer-vroom-for-deceiving-customers-failing-to-deliver-on-time-and-provide-required-disclosures","status":"publish","type":"post","link":"https:\/\/tvdelmarva.com\/wp\/ftc-takes-action-against-online-used-car-dealer-vroom-for-deceiving-customers-failing-to-deliver-on-time-and-provide-required-disclosures\/","title":{"rendered":"FTC Takes Action Against Online Used Car Dealer Vroom for Deceiving Customers, Failing to Deliver on Time and Provide Required Disclosures"},"content":{"rendered":"

The Federal Trade Commission has taken action against online used car dealer Vroom for misrepresenting that it thoroughly examined all vehicles before listing them for sale and failing to obtain consumers\u2019 consent to shipment delays or provide prompt refunds when cars weren\u2019t delivered in the time Vroom promised.<\/p>\n

Texas-based Vroom has agreed to a proposed settlement that would require the company to pay $1 million to refund consumers harmed by the company\u2019s conduct and prohibit the company from further misleading consumers and failing to provide required disclosures.<\/p>\n

\u201cVroom promised the fast deliveries of thoroughly inspected cars, but sped right past compliance,\u201d said Samuel Levine, Director of the FTC\u2019s Bureau of Consumer Protection. \u201cOnline car dealers and other Internet sellers must provide required disclosures just like any brick-and-mortar businesses that comply with the law.\u201d<\/p>\n

In its complaint against Vroom<\/a>, the FTC alleges that the company failed to follow the Used Car Rule, the Pre-Sale Availability Rule and the Mail, Internet, and Telephone Order Rule (MITOR).<\/p>\n

Since 2019, Vroom has sold more than 170,000 vehicles to consumers through its website. In its advertising, Vroom said that its cars underwent \u201cmultiple inspections\u201d to ensure they were in good condition in an effort to alleviate consumers\u2019 concerns about buying a used car without being able to inspect it before purchasing. Vroom\u2019s website even listed 184 points of inspection that were checked on every car they sold.<\/p>\n

Consumer complaints about the company told a different story, according to the FTC\u2019s complaint. Numerous consumers complained about the condition of the cars they received from Vroom, with everything from loud grinding noises, bald tires, and worn brakes being reported.<\/p>\n

The complaint also notes that Vroom told consumers that cars purchased from the company would be delivered in 14 days or less in its advertising and on its website. Despite making this clear statement, when it couldn\u2019t meet that delivery timeline, Vroom regularly failed to give consumers the chance to either consent to a longer delivery timeline or cancel their purchase and receive a prompt refund, as required by MITOR. The complaint cites instances where consumers have had to wait as much as three months or longer before their car arrived.<\/p>\n

As a used car dealer, Vroom also is required to follow the FTC\u2019s Used Car Rule, which includes\u00a0 a requirement that the dealer properly complete and display a \u201cBuyers Guide\u201d on each used car it offers for sale. The Buyers Guide gives consumers important information about whether the used car comes with a warranty or it is being sold \u201cas is.\u201d\u00a0<\/p>\n

If the car is sold with a dealer\u2019s warranty, the Used Car Rule requires the Buyers Guide to list its basic terms and conditions, including the duration of coverage, the percentage of total repair costs to be paid by the dealer, and the exact systems covered by the warranty. The complaint alleges that Vroom failed to provide the Buyers Guide until late in the purchase process, and that the Guides were often missing required information.<\/p>\n

Finally, the complaint alleges that Vroom violated the Pre-Sale Availability Rule because it did not post the terms of its warranty on its website in close proximity to the warranted used vehicle. Nor did Vroom inform customers how they could obtain the warranty\u2019s terms prior to the receipt of the sale documents.<\/p>\n

Under the terms of the proposed settlement<\/a>, Vroom will be required to pay $1 million to the FTC to be used to provide refunds to consumers who were harmed by the company\u2019s unlawful practices.<\/p>\n

The settlement also prohibits the company from making misleading claims to consumers about inspections or shipping, and requires Vroom to document all claims about promises it makes about shipping times to consumers, as well as requiring Vroom to follow the requirements of MITOR, the Used Car Rule, and Pre-Sale Availability Rule.<\/p>\n

The Commission vote authorizing the staff to file the complaint and stipulated final order was 5-0. The FTC filed the complaint and final order in the U.S. District Court for the Southern District of Texas.<\/p>\n

NOTE:\u00a0<\/strong>The Commission files a complaint when it has \u201creason to believe\u201d that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. Stipulated final orders have the force of law when approved and signed by the District Court judge.<\/p>\n

The staff attorneys on this matter were Luis Gallegos, Sarah Zuckerman, and Serena Mosley-Day of the FTC\u2019s Southwest Region.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Federal Trade Commission has taken action against online used car dealer Vroom for misrepresenting that it thoroughly examined all vehicles before listing them for sale and failing to obtain consumers\u2019 consent to shipment delays or provide prompt refunds when cars weren\u2019t delivered in the time Vroom promised. Texas-based Vroom has agreed to a proposed […]<\/p>\n","protected":false},"author":19,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[29],"tags":[],"class_list":["post-9198","post","type-post","status-publish","format-standard","hentry","category-news"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/pbtNqq-2om","jetpack-related-posts":[{"id":11438,"url":"https:\/\/tvdelmarva.com\/wp\/ftc-illinois-take-action-against-leader-automotive-group-for-overcharging-and-deceiving-consumers-through-add-ons-junk-fees-bogus-reviews\/","url_meta":{"origin":9198,"position":0},"title":"FTC, Illinois Take Action Against Leader Automotive Group for Overcharging and Deceiving Consumers Through Add-Ons, Junk Fees, Bogus Reviews","author":"jmayfield","date":"December 19, 2024","format":false,"excerpt":"A group of 10 car dealerships doing business as Leader Automotive Group and their parent company, AutoCanada, will be required to pay $20 million to settle allegations they systematically defrauded consumers looking to buy vehicles as a result of a lawsuit by the Federal Trade Commission and state of Illinois.In\u2026","rel":"","context":"In "News"","block_context":{"text":"News","link":"https:\/\/tvdelmarva.com\/wp\/category\/news\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/tvdelmarva.com\/wp\/wp-content\/uploads\/2023\/10\/Seal_of_the_United_States_Federal_Trade_Commission.svg_.png?fit=640%2C360&ssl=1&resize=350%2C200","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/tvdelmarva.com\/wp\/wp-content\/uploads\/2023\/10\/Seal_of_the_United_States_Federal_Trade_Commission.svg_.png?fit=640%2C360&ssl=1&resize=350%2C200 1x, https:\/\/i0.wp.com\/tvdelmarva.com\/wp\/wp-content\/uploads\/2023\/10\/Seal_of_the_United_States_Federal_Trade_Commission.svg_.png?fit=640%2C360&ssl=1&resize=525%2C300 1.5x"},"classes":[]},{"id":9804,"url":"https:\/\/tvdelmarva.com\/wp\/ftc-state-of-arizona-take-action-against-coulter-motor-company-for-deceptive-pricing-and-discriminatory-practices\/","url_meta":{"origin":9198,"position":1},"title":"FTC, State of Arizona Take Action Against Coulter Motor Company for Deceptive Pricing and Discriminatory Practices","author":"jmayfield","date":"August 15, 2024","format":false,"excerpt":"The Federal Trade Commission and State of Arizona are taking action against Arizona-based Coulter Motor Company for engaging in a wide array of practices that harm consumers, from deceptive online vehicle pricing to charging Latino car buyers more in interest and add-on products. 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