At a press conference Tuesday in Manhattan, Department of Consumer Affairs Commissioner Jonathan Mintz points out a deceptive advertisement for a used car dealership. (Courtesy of the NYC Department of Consumer Affairs)

NEW YORK—The New York City Department of Consumer Affairs (DCA) is cracking down on used car dealerships for deceptive advertising practices, announced Commissioner Jonathan Mintz on Tuesday.

Investigators found that 10 out of 18 dealerships while advertising in several New York publications used “bait and switch” tactics to attract consumers. These included advertising cars that had already been sold or featuring lower prices than the ones found at the dealerships.

The two-month investigation issued violations to dealerships in all five New York City boroughs, with Queens and Staten Island topping the list.

“It is illegal to say to a consumer that you have a great deal and you don’t,” said Commissioner Mintz.

Any claim or action that has the potential to deceive consumers is illegal according to the New York City Consumer Protection Law, which the DCA enforces.

“One way or another, used car dealers in this city are going to learn that the best way to run a business is to distinguish themselves by offering customers good, legitimate deals,” said Mintz in the press release.

In 2008, there were just over 700 complaints of used car dealerships, almost triple the 260 in 2004.

The Commissioner highlighted however that most licensed dealerships are law abiding, and that the crackdown on fraud is both to protect these businesses and consumers. There are currently almost 850 licensed used car dealerships in the DCA.

Complaints about used car dealerships are among the top 5 complaints reported by the DCA. The top five, from most to least, are over debt collectors, home improvement contractors, furniture stores, used car dealerships, and electronics stores.

The biggest increase is seen in the number of debt collectors, which saw a 69 percent increase from 2007-2008. People complained about being harassed about debts they did have and the debt collectors’ aggressive tactics, such as calling in the middle of the night.

In 2008, the DCA received and investigated 7,600 complaints and restituted $8.4 million to consumers.

More information on licensing for used car dealerships or other businesses in New York can be found on the DCA Web site.

Consumer alert documents such as Used Car Sales Consumer Guide or False Advertising: How to Spot It and Read the Fine Print are also available on the Web site.

For side bar:
Tips for Buying Used Cars
Courtesy of the NYC Department of Consumer Affair

• If buying a used car, first check if the dealership is licensed by DCA.
Use the instant license check tool on the DCA Web site or call 311 to confirm that a used car dealer is licensed.

• Get a copy of your credit report before you start shopping around.
Correct any errors, or work on improving it before you apply for a car loan so that you get the best deal. Go online to www.annualcreditreport.com for a free copy of your credit report.

• Get pre-approved for a loan BEFORE going shopping.
The terms and eligibility requirements for financing can be complicated. If you are going to finance your car purchase, knowing rates before you shop will help you compare rates and find the best option for you. If you use your own bank or credit union, you will also be dealing with an institution with which you have a relationship if anything goes wrong.

• Don't negotiate a purchase based on a monthly payment.
Your goal is to negotiate the best price for the car at the lowest interest rate and for the fewest number of payments. Pay close attention to the terms; negotiate the total cost of the car, the interest rate and the total amount that you are financing. Then estimate the monthly payment amount.

• Say no to "add-ons" and options.
Most add-ons or options like paint and fabric protection, rust-proofing, extra security systems, extended warranties, etc. are cheaper when bought separately. Ask for a calculation of your monthly payments with and without the add-ons and options.

• Never sign a blank or incomplete agreement or contract. Only sign complete contracts. Never sign a contract if you don’t understand the terms. If a car sale is negotiated in Spanish, the contract must also be written in Spanish. Always keep all copies of any contract or paperwork signed.

• File a complaint with DCA.
Call 311 or go online to www.nyc.gov/consumers to contact DCA.