Victory Mitsubishi of Larchmont engaged in deceptive business practices, a Westchester Supreme Court justice has ruled, when the car dealer failed to fully inform customers about antitheft etching products.
Justice Charles D. Wood ruled on Aug. 9 that Victory and its affiliated dealership, Victory Suzuki of the Bronx, “repeatedly and persistently engaged in fraud.”
Former state Attorney General Eric T. Schneiderman sued the dealerships last year, claiming they had made at least $751,000 by misleading as many as 1,100 customers about optional antitheft products from 2012 through 2016.
The state refers to such schemes as “jamming,” the practice of charging customers for services or products without their knowledge or consent.
The dealers, for instance, sold a service through which serial numbers are etched on car windows to deter theft or make it easier for police to recover the vehicle if it is stolen. The product was presented as an “etch guarantee” or a replacement vehicle discount allowance.
Victory dealers paid a Texas company $25 for each etch guarantee, according to Wood’s order, and resold them for an average of $1,175.
The option was added to bills after customers had agreed on the car price but before they signed the final deal. The price ranged from $129 to nearly $4,000.
Some customers, investigators found, had not realized they had bought the product. In some cases, no work was done.
In a random sampling of 10 vehicles whose owners paid for an etch guarantee, investigators found eight had no etching and one owner whose windows were etched was unaware of the purchase.
The state began its investigation in April 2015 after a customer who bought a vehicle at Victory Mitsubishi, located at 2020 Boston Post Rd. in Larchmont, noticed $1,995 on the bill of sale itemized as “etch.” She told investigators that she had not been informed about the product and would not have bought it.
Victory made a full refund after the attorney general’s office asked about the charge.
The alleged conduct ended by early 2016, Victory representative Diane Argyropoulos said in an affidavit, and Victory has since reimbursed 100 customers.
“None of the sales people, finance managers or general managers who worked for Victory during the relevant time period,” she said, “are still with the dealerships.”
She said the products were clearly identified on the bills of sale and other documents signed by customers.
Though the etch products “seem to be marked in some fashion upon the face of the bill of sale,” Wood ruled, customer complaints and investigators’ affidavits “show a pattern of deceptive and misleading conduct.”
He ordered the dealers to appear for a restitution hearing on Oct. 16. They will have to pay restitution to customers who paid for the etch product without their knowledge or consent and pay the state up to $5,000 for each violation.
The dealerships are owned by Philip Argyropoulos of Glen Head, Long Island.
“This court order is a victory of New Yorkers,” New York Attorney General Barbara D. Underwood said in a news release, “who were ripped off by these car dealerships.”