x
Breaking News
More () »

Paul Blanco dealerships being accused of deceiving customers, credit lenders

Attorney General Xavier Becerra said one of the tactics Blanco's employees used was allegedly covering up prices with their hand.

SACRAMENTO, Calif. — California Attorney General Xavier Becerra filed a lawsuit against Sacramento auto dealer Paul Blanco's Good Car Company for allegedly deceiving its customers and credit lenders.

"It might be called Paul Blanco's Good Car Company," Becerra said. "For many families, that name couldn't be further from the truth." 

Becerra alleges Blanco's Good Car Company used deceitful advertising, illegal sales and told its customers that law requires for the consumers to purchase add-on products such as service contracts or GAP insurance. In some cases, Becerra said, the car dealership would charge the customer add-on services without telling them. 

No law says that you need to buy add-ons such as service contracts with the car dealership.

READ ALSO:

The lawsuit claims Good Car Company produced advertisements on television, radio and online, making false promises of low-interest rates for customers who would not usually qualify. Becerra said the company's prolific TV and radio ads would boast about 2 percent interest rates and approving people for loans over the phone. 

Becerra highlighted one advertising campaign targeted at seniors called the “Senior Gold Program."

"The dealership even promoted a program for senior citizens that supposedly offered reduced prices and an easier approval process," said Becerra. "When in reality, no such program ever existed."

Becerra also claimed the company tricked customers into paying thousands for optional add-on products, such as service contracts and GAP insurance, by telling customers that the add-ons were required by law or included in the sale price. 

Becerra alleged sometimes they'd hide the fact the dealership had added a hidden charge.

"Sometimes literally by covering them up with their hands," said Becerra.

Deputy Attorney General Hunter Landerholm said they are not looking to shut down The Good Car Company, but to stop their unlawful practices. He added that the California Department of Justice investigated Blanco's car company almost exactly two years ago.

Becerra said the attorney general's office does not know how many people were impacted by Paul Blanco's Good Car Company's tactics.

Becerra also claimed the company lied to lenders to get financing in order to secure funding for risky loans.

“Lies ranged from deceiving lenders about the value of vehicles financed to misrepresenting consumers income and other information on credit applications,” said Becerra.

Paul Blanco's Good Car Company issued a statement in response to the lawsuit saying: 

“Our family-run business has helped hard-working Californians who cannot afford or don’t have the credit score necessary to buy a car at other dealerships do so,” said Putu Blanco, CFO of the Paul Blanco’s Good Car Company. 

Paul Blanco’s Good Car Company has rigorous controls and a culture of compliance in place to ensure California regulations are followed and consumers are protected. We will fight this misguided action vigorously to demonstrate to the Attorney General and his lawyers that our customers and California consumers come first.”

Paul Blanco's Good Car Company operates seven auto dealerships in California and two in Nevada.

Read the full court filing below:

WATCH ALSO: PG&E could be shutting off power to more than 124,000 customers in fire-prone areas | Daily Blend 

 

Before You Leave, Check This Out