The Federal Trade Commission (FTC) is taking action against Asbury Automotive, a large automotive dealer group, for allegedly charging consumers for costly add-on items without their consent and discriminating against Black and Latino consumers by targeting them with unwanted and higher-priced add-ons.
In an administrative complaint, the FTC alleges that three Texas dealerships owned by Asbury—David McDavid Ford Ft. Worth, David McDavid Honda Frisco, and David McDavid Honda Irving—along with Ali Benli, who acted as general manager of those dealerships, engaged in practices to include hidden fees for unwanted add-ons. These tactics reportedly included "payment packing," where dealerships convinced consumers to agree to monthly payments larger than needed for the car's agreed-upon price and then added on items to the sales contract.
"The FTC will continue to crack down on illegal hidden fees and discrimination, which have no place at car dealerships," said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. "Like the Combating Auto Retail Scams (CARS) Rule, today’s action underscores our commitment to protecting consumers shopping for cars and leveling the playing field for honest dealers."
Numerous consumer complaints detailed being charged thousands of dollars without their knowledge for add-ons such as protective chemical coatings, service contracts, and life and disability insurance policies. Some reported that salespeople never discussed these products during the sales process; others specifically declined them only to find they were added without consent. The FTC states that Asbury’s sales process made it difficult for consumers to know they were being charged for these add-ons.
A survey across the dealerships showed that up to 75 percent of consumers reported being charged for unauthorized or falsely required add-on products and services. Company documents revealed that Black and Latino consumers were treated differently from non-Latino White consumers, often charged hundreds of dollars more on average for these add-ons without consent.
The complaint alleges violations of both the FTC Act and the Equal Credit Opportunity Act by Asbury Auto Group, the three dealerships, and Benli.
The Commission voted 5-0 to issue the administrative complaint. Commissioners Melissa Holyoak and Andrew Ferguson issued statements regarding this action.
The issuance of an administrative complaint marks the beginning of a formal proceeding before an administrative law judge where these allegations will be tried.
Staff attorneys Jamie Brooks, James Doty, Dan Dwyer, and Sarah Abutaleb from the FTC’s Bureau of Consumer Protection are handling this matter.
The Federal Trade Commission works to promote competition while protecting and educating consumers. For more information about consumer topics or reporting frauds or scams visit consumer.ftc.gov or ReportFraud.ftc.gov.
