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For Immediate Release

Media Contact:
Raquel Guillory, 410-576-6357
rguillory@oag.state.md.us

Attorney General Gansler Sues Deceptive Auto Warranty Marketer
Charges Allege Deceptive Claims Regarding Auto Warranty Plans

BALTIMORE, MD ( August 16, 2010) -Attorney General Douglas F. Gansler announced today that the Consumer Protection Division has charged a Missouri company, U.S. Fidelis, Inc., - formerly known as National Auto Warranty Services, Inc. and having done business as Dealer Services - and the company’s owners, Darain Atkinson and Cory Atkinson, with engaging in unfair and deceptive trade practices and violating Maryland’s Telephone Solicitations Act. The Act prohibits businesses from charging consumers for goods or services that are sold over the telephone until the consumers have signed contracts setting forth the terms of their purchase.

The Division’s charges allege that the company offered and sold auto repair warranties that claimed to extend the existing manufacturer’s warranty and provide comprehensive “bumper-to-bumper” coverage. The cost of the warranties ranged from $500 to $2,000. The Division alleges that the warranties did not extend manufacturer warranties; instead, they provided only limited coverage from a third-party insurer. According to the Division’s charges, when consumers made claims under these warranties, they were frequently denied because the insurer claimed the repair was excluded.

“Before purchasing an extended warranty, consumers need to be armed with all the facts,” said Attorney General Gansler. “Auto repair warranties can be costly and may provide very little coverage in return for their expense.”

The Consumer Protection Division advises consumers not to do business with any third-party warranty company that claims it can extend a manufacturer’s warranty. Only vehicle manufacturers can extend the manufacturers’ warranties on the vehicles they sell.

The Division is seeking an injunction to stop the company’s deceptive advertising and sales practices, as well as payment of restitution, penalties and costs. A public hearing on the charges is scheduled for October 19, 2010 at 9:30 a.m. at the Office of Administrative Hearings, 11101 Gilroy Road in Hunt Valley. Consumers who wish to contact the Consumer Protection Division regarding this matter may call (410) 576-6577.

   

Attorney General of Maryland 1 (888) 743-0023 toll-free / TDD: (410) 576-6372
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