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Westchester Auto Dealer Fined $298K For Scamming Customers

Nissan of New Rochelle has agreed to pay back customers for 'add-on' sales.
Nissan of New Rochelle has agreed to pay back customers for 'add-on' sales. Photo Credit: Google Maps

WESTCHESTER COUNTY, N.Y. -- A Westchester automobile dealer was fined almost $300,000 on Tuesday for scamming customers into purchasing bogus Anti-theft products, according to New York State Attorney General Eric T. Schneiderman.

Pana Nissan, LLC, also known as Nissan of New Rochelle, agreed to the settlement for deceptively charging hundreds of consumers for the unwanted product that cost up to thousands of dollars per consumer, Schneiderman said.

According to Schneiderman, the car dealer would add the cost of the product onto the final cost of the vehicle without the consumer’s knowledge or consent, after the customer had agreed upon the purchase price of a vehicle but before the sale transaction was finalized.

“Consumers should not have to worry that they are being scammed into adding on bogus products and services when they purchase a car,” said Schneiderman. “Buying a car is already a major investment for many families, and tacking on thousands of dollars extra can become a significant financial burden. I am pleased that we are able to return hundreds of thousands of dollars in restitution to the nearly 300 consumers who were scammed and defrauded.”

The AG's Office started an investigation into the dealership after receiving a complaint from a consumer in August 2015 that Nissan of New Rochelle had fraudulently sold them an after-sale product.

The investigation found that Nissan of New Rochelle sold hundreds of consumers a product called Total Loss Protection, which was meant to serve as a theft deterrent. Consumers were charged amounts ranging from $215 to over $5,000.

In addition, the dealership also conned customers by advertising the product as a permanent etch or engraving of the vehicle’s VIN, or a registered serial number, on the windows of the vehicle – supposedly to deter theft. Instead, for some vehicles, the dealership placed sticker decals with assigned registration numbers on the inside of the door or door-jamb where no one could see them or didn't even bother to provide stickers or decals, the AG's Office said.

The dealership also scammed people by guaranteeing a credit of $3,000 or $5,000 toward the purchase of a new car if their car was stolen, but there was so limitations to the process that only one person ever received the credit, the AG's Office said.

In addition to the customer refunds, the dealership also agreed to certain reforms to its sales practices, including:

  • Fully disclosing that any and all after-sale services or products are optional and that the price is negotiable;
  • Clearly explaining to each consumer any and all after-sale services or products being offered by the dealership; and
  • Only adding an after-sale service or product to the final bill with the knowledge and full consent of the consumer.

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