TEMPE, Ariz. — One of Arizona’s oldest family-owned car dealerships has agreed to comply with a court order regarding allegations of deception and discriminatory sales practices.
Coulter Motor Company and one of its former general managers will pay $2.6 million, most of which will go to customers allegedly harmed by the company’s actions.
“Coulter’s deceptive and discriminatory practices are unacceptable,” said Attorney General Kris Mayes in a statement to 12News. “My office will not tolerate this kind of predatory behavior.”
According to a complaint filed Thursday, Mayes and the FTC alleged wrongdoing by Coulter at two of the company’s locations: Coulter Cadillac Tempe and Tempe Buick GMC. The claim alleges the company violated laws regarding consumer rights and fraud.
Coulter Operations Director Lindsey Coulter says the dealership agreed to the court order to avoid the potential of years of litigation.
“We respectfully deny all allegations from the FTC,” Coulter said.
Evidence cited by prosecutors filed in court alleges the company:
- advertised non-existent lower prices online to lure customers to the dealership
- charged customers for unwanted add-ons and fees during purchases
- charged twice for the same “add-ons” during purchases
- discriminated against Latino consumers by pushing nearly $1,200 more in “interest and add-on charges” compared to their non-Latino White counterparts
The claim alleges it was no secret at the dealership that customers complained about unfair practices.
“Defendant (General Manager) received complaints from consumers … as well as updates from employees … regarding persistent bait-and-switch advertising tactics and hidden add-on charges,” the claim states.
12News was unable to reach that former general manager who is named in the complaint, Gregory Depaola.
The settlement requires Coulter to implement a fair lending program, appoint a fair lending officer, conduct employee training, and implement new policies for charging fees and markups.
“We stand behind doing things the right way, as always we will continue doing that,” Lindsey Coulter said.
Coulter claims the company was blindsided by the allegations. For example, she said she saw no evidence of customers charged twice for the same “add-ons.”
“We combed through all the information we gave to the FTC two years ago to see if there was any validity to anything. There is no validity,” Coulter said.
The legal claim lists evidence that includes online ads that allegedly promoted a non-existent “Coulter Price.” It refers to “numerous instances” of defendants charging customers “hundreds or thousands of dollars more than the advertised price, including for a previously unmentioned and contrived ‘market adjustment,’ purportedly for preinstalled add-ons, and miscellaneous fees.”
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