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Multiple U.S. States Sue Extended Car Warranty Companies

Marketing can be an extremely difficult terrain if you are trying (too hard) to push boundaries in the pursuit of new customers. The latest example that comes to support this is the fact that eight U.S. states, together with the District of Columbia, have sued three of the country’s extended car warranty companies for using deceptive practices to attract new customers, as Consumeraffairs reports.

Consumers have filed hundred of complaints against US Fidelis (based in Missouri), Credexx Corporation (based in California) and Auto One for releasing misleading statements regarding the offering of extended auto warranty contracts.

"These companies misled consumers by marketing and selling 'extended warranties' that were actually service contracts," Ohio Attorney General Richard Cordray was quoted as saying by the aforementioned source. "Service contracts are not warranties as defined by law and do not have to meet the same standards. Consumers spent hundreds and thousands of dollars under the false belief that they were buying comprehensive warranties, when that was not the case."

The lawsuits stated that the companies tried to convince customers that their services covered all the mechanical issues of a vehicle, when in fact they were only related to certain mechanical problems and falsely represented themselves as having an agreement with the automotive manufacturers.

Every time a company tricks consumers into purchasing a phony product, it sheds a negative light on the business community,” Kansas Attorney General Steve Six told the aforementioned source. “The Attorney General’s office is committed to protecting consumers and giving Kansans confidence in knowing they are dealing only with reputable firms. If you’re breaking the law in the name of making the sale, we will come after you.
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About the author: Andrei Tutu
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In his quest to bring you the most impressive automotive creations, Andrei relies on learning as a superpower. There's quite a bit of room in the garage that is this aficionado's heart, so factory-condition classics and widebody contraptions with turbos poking through the hood can peacefully coexist.
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