In the latest price transparency case, the Alaska Attorney General’s office announced a $500,000 settlement with a used car dealer over not including document fees in advertised prices.
Driving the news: As scrutiny grows over price transparency after recent warnings from the Federal Trade Commission, acting Alaska Attorney General Cori Mills announced a settlement with Payless Used Car Sales.
The state requires all fees to be included in the advertised price.
Payless charged doc fees of $499, which were not included in the advertisements on its website, according to the state.
The Alaska AG said a majority of customers charged the fees were prior to 2024, with customers dating back to November 2018 now eligible for restitution payments of $100.
By the settlement, Payless will pay approximately $500,000 to more than 5,000 customers within 280 days.
What they’re saying: “Alaska’s law on dealer fees is clear,” Mills said in a press release. “It is unacceptable for a business to offer one price online and then a higher price at the dealership as a result of tacking on previously undisclosed dealer fees.”
The Alaska law is consistent with the new FTC guidance requiring that all fees outside taxes be included in the total price.
In its FAQs, the FTC was adamant that the price that any consumer could walk in and pay for a vehicle is the most prominent price on the advertisement and that “state-specific document fees rules” do not change the FTC requirement that the advertised price reflect every dealer-required charge.
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States pursuing cases: While attention has been focused on FTC compliance since the warning letters sent to 97 dealers in March, state authorities have been involved in enforcing advertising and sales compliance rules.
KPA Chief Legal and Strategy Officer Adam Crowell told CDG News that eight of the past nine FTC actions on price transparency and fees have been in conjunction with state AGs.
Those actions have amounted to more than $130 million in damages and restitution.
“That’s just the cases where the FTC doubled up with the state attorneys general,” Crowell noted.
Bottom line: The Alaska case points out that throughout the nation, dealers need to be making sure all the proper disclosures are being made on advertisements with the current fees and prices.
“This is just one of those bipartisan issues. We’ve seen it unfold with the last administration and we’re seeing it unfold with this administration,” Crowell said. “It’s something that people can get behind. As consumers, whether you’re looking at concert tickets, short-term rentals or a hotel, or a vehicle, you want to be able to see the price and be able to get that price.”
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