FTC targets Lindsay Automotive for alleged deceptive practices

The Federal Trade Commission (FTC) and Maryland Attorney General Anthony Brown have filed a legal complaint against Lindsay Automotive Group, alleging years of deceptive practices that cost car buyers millions.

Driving the news: The complaint accuses the Washington D.C.-area dealership group of bait-and-switch advertising, hidden fees, mandatory financing schemes and unauthorized add-ons. The FTC says the alleged tactics cost 88% of buyers, between 2020 and 2023, an average of $2,000 more than advertised prices.

• According to the suit, Lindsay advertised vehicle prices that most customers couldn’t qualify for due to complex rebate requirements.

• Consumers were allegedly told they had to finance through the dealership to get advertised prices, often at higher rates.

• The FTC also claims that many buyers were hit with undisclosed charges, with nearly 68% being charged for unwanted extras like service plans or tire protection.

Zooming in: The FTC and Maryland AG are seeking a permanent injunction to stop Lindsay’s practices, along with restitution for consumers and $10,000 per-violation fee.

• Lindsay Chevrolet, Lindsay Ford, Lindsay Chrysler-Dodge-Jeep-Ram, and key executives, including part-owner Michael Lindsay, are named in the complaint.

A spokesperson from Lindsay Automotive had this to say: “As a responsible company, we are committed to fully complying with the law and providing excellent customer service. You can rest assured that our focus remains where it has always been on providing the absolute best option for our customers and on serving the community in a manner that would make all of our employees, customers, and partners proud. We strongly refute any suggestion of improper conduct and will work to resolve this matter through the legal process.”

Bottom line: Although legal challenges to strict FTC policies like the CARS rule are still underway, dealers need to be proactive with compliance. This will help protect them from punitive action in the event of a federal investigation.

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