A Valencia Mercedes Benz dealer, part of a nine-dealership chain known as Sage Automotive Group, paid a $3.5 million fine for deceptive advertising practices.
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Federal Trade Commission members charges the car dealers “used deceptive and unfair sales and financing practices, deceptive advertising, and deceptive online reviews.”
Mercedes Benz of Valencia was cited in the order for the violations
The proposed order will bar the defendants from engaging in other unlawful conduct when a sale is cancelled, such as failing to return any down payment or trade-in or seeking legal action, arrest, repossession or debt collection unless the action is lawful and the defendants intend to take such action. It also prohibits them from violating the Truth In Lending Act and Regulation Z, and the Consumer Leasing Act and Regulation M.
The order also prohibit the defendants from making misrepresentations relating to their advertising, add-on products, financing, and endorsements or testimonials.
The corporate defendants are Universal City Nissan, Inc., also d/b/a Universal Nissan; Sage Downtown, Inc., also d/b/a Kia of Downtown Los Angeles; Glendale Nissan/Infiniti, Inc., also d/b/a Glendale Infiniti and Glendale Nissan; Valencia Holding Co., LLC, also d/b/a Mercedes-Benz of Valencia; West Covina Auto Group, LLC, also d/b/a West Covina Toyota and West Covina Toyota/Scion; West Covina Nissan, LLC; Covina MJL, LLC, also d/b/a Sage Covina Chevrolet; Sage North Hollywood, LLC, also d/b/a Sage Pre-Owned; Sage Vermont, LLC, also d/b/a Sage Hyundai; Sage Holding Company Inc. and Sage Management Company Inc.
The individual defendants are Joseph Schrage and Michael Schrage.
The Commission vote approving the stipulated final order was 2-1, with Acting Chairman Maureen K. Ohlhausen dissenting.
NOTE: Stipulated final orders have the force of law when approved and signed by the District Court judge.