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Lawsuit Targets “Certified” Used Cars
Several safety watchdog groups have sued the U.S. Federal Trade Commission for allowing used-car dealers to sell “certified” vehicles that have outstanding safety recalls, Reuters reports.
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Several safety watchdog groups have sued the U.S. Federal Trade Commission for allowing used-car dealers to sell “certified” vehicles that have outstanding safety recalls, Reuters reports.
The industry uses the term “certified” to indicate used cars that have been undergone a multi-point inspection and had mechanical problems repaired before being resold.
The lawsuit targets a settlement reached a year ago between the FTC, Lithia Motors Inc. and Jim Koons Management concerning unresolved defects that are part of a safety recall. The consent decree requires the companies to disclose any uncompleted safety recalls for vehicles they describe as “certified pre-owned.” But it allows them to otherwise sell such vehicles anyway.
The lawsuit demands that resellers simply fix any recalled defect before selling any "certified" used vehicle. Anything less, the plaintiffs insist, protects “unscrupulous auto dealers who engage in false and deceptive advertising” about the safety of the used vehicles they sell.
General Motors Co. tells Reuters it doesn’t allow its dealers to use the term certified to advertise a vehicle unless recall repair have been completed.
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