Don’t Be Fooled by Extended Auto Warranty Scheme

You open your mail to find a postcard, stamped in red with the words “FINAL NOTICE: Expiring Auto Warranty.”  Watch out; it’s probably a scam.

According to the Better Business Bureau, complaints against questionable auto warranty processing services have risen by more than 40 percent in the past year.  In these tough economic times, some less-than-scrupulous businesses are doing all they can to separate you from your hard-earned money.

The solicitations come through direct mail or telephone calls.  The services often have official-sounding names, and mailers are typically marked with last-chance warnings.  Representatives use high-pressure sales tactics, stressing special discounts only available if you buy “right now”.  These shady solicitations entice consumers to buy coverage they don’t need.  Even worse, the services may not deliver the coverage they promise.  Consumers who purchase the unneeded coverage usually find that pre-existing conditions are excluded, detailed maintenance records may be required, there may be limited authorized repair facilities, and frequently repair charges must receive prior approval before payment will be made.

To avoid receiving these calls and mailings in the first place, sign up with the Do Not Call Registry at http://www.donotcall.gov or by calling, toll-free, (888) 382-1222 and with the Direct Marketing Association’s Mail Preference Service at http://www.dmachoice.org.   

What do you do if you get one of these calls?

 “First, hang up the phone,” says Commissioner Campos.  “Then, file a complaint with us at Consumer Affairs and with the Federal Trade Commission (FTC).  The FTC has the authority to sue the company, fine them, and force them to stop their deceptive sales techniques.”

If you’re considering the offer, be sure to check the company out thoroughly.

·        Research them with the Nevada Consumer Affairs Division by calling (702) 486-7355 or (775) 688-1800.

·        Review the consumer complaints in the ConsumerAffairs.com section on Extended Warranties at http://www.consumeraffairs.com/auto_warranty/index.html.

·        Get all information and conditions in writing.

·        Do not give any personally identifying information, such as your Social Security Number or bank account, over the phone.

If you’ve been a victim of auto warranty fraud, contact Consumer Affairs at http://www.fyiconsumer.org or by calling (702) 486-7355 or (775) 688-1800.

Commissioner Campos also encourages consumers to visit the Fight Fraud Website at http://fightfraud.nv.gov/.  “The site includes extensive tips on how to prevent fraud and provides downloadable complaint forms to help you respond effectively if you become a victim,” says Campos.  “Visit it regularly for the latest fraud alerts.”