#local used car dealers
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Indianapolis used car dealer Circle City Auto Exchange Inc. and two of its affiliates were sued by the state Monday for allegedly selling total loss vehicles to customers without disclosures, charging unfair prices and offering useless warranties, the Indiana Attorney General office announced.
According to the lawsuit, Circle City would purchase total loss vehicles from auctions, usually in Michigan, for a low price and then apply for a clean title from the Indiana Bureau of Motor Vehicles.
Circle City then sold the vehicles at a clean retail price to unsuspecting consumers without disclosing that the vehicles were previously involved in major accidents and declared total loss vehicles, the lawsuit says.
The attorney general called the actions abusive, unconscionable and intentional violations of Indiana s Deceptive Consumer Sales Act.
In addition to Circle City Auto Exchange, 3002 Madison Ave. the lawsuit names Circle City Auto Connection Inc. 6502 W. Washington St. and Circle City Sales Service Inc. 6411 Kentucky Ave.
Also named are three individuals who control operations of the company: Amy Lair, Brandi Pierson and Shawn Lessor.
The state alleges the businesses have sold at least 60 previously declared total loss vehicles to Indiana consumers since November 2013. The attorney general s office said it received 56 consumer complaints against Circle City Auto Exchange in the past three years.
We have been fully cooperative with the state s requests for records and strongly believe that the dealerships have done everything required of them under the law, Mario Garcia, an attorney representing Circle City Auto Exchange, said in an email. The suit appears to be based on a small fraction of the sales the dealerships made and we are disappointed the state chose to file this action, wasting taxpayer dollars. We look forward to disproving their allegations.
According to state law, when a vehicle is determined to be a total loss after an accident, the insurance company or owner must obtain a salvage title from the BMV. For a salvage vehicle to be eligible to be operated on Indiana roads, the owner must then apply for a rebuilt title after an inspection of the vehicle by a police officer and submission of an affidavit detailing any major parts that were replaced to restore the vehicle.
The lawsuit alleges that the defendants did not properly rebuild the total loss vehicles for use on Indiana roads, have the vehicles and any repairs inspected or submit the required affidavits regarding restoration of the vehicles to the BMV.
The defendants have used multiple deceptive tactics to sell Hoosiers cars that have serious limitations and likely shouldn t be on the road, Indiana Attorney General Greg Zoeller said in a written statement. In the auto industry, the seller often has more information about a vehicle than the buyer does, and this can easily lead to buyers being taken advantage of. I urge all car buyers to know and understand their rights and research a company before making a car purchase.
The lawsuit said the businesses also sold the vehicles at interest rates as high as 24 percent without telling the finance companies that the vehicles were salvaged or rebuilt.
The dealers also sold customers expensive extended warranties on the vehicles, even though the pre-existing damage to the vehicle voided the warranty contracts, the lawsuit alleges.
According to the state, many of the 60 vehicles were eventually repossessed because customers couldn t afford the high payments or because the vehicles quickly became mechanically unsound and unsafe.
The state is seeking restitution for customers who suffered losses, in addition to investigative costs and civil penalties in the amount of $5,000 per violation.