Information and Alerts

Government Actions

0:22-cv-60298-RAR Federal Trade Commission v. American Vehicle Protection Corp.

As of October 10, 2024

FTC Sends More Than $449,000 to Consumers Harmed by ‘Extended Vehicle Warranty’ Scam

The Federal Trade Commission is sending more than $449,000 in refunds
to consumers who were harmed by American Vehicle Protection Corp.,
which engaged in a telemarketing scam that involved calling hundreds of
thousands of consumers nationwide to pitch expensive “extended
automobile warranties” using deceptive telemarketing tactics.

The FTC took action against American Vehicle Protection in 2022,
charging that the operation made illegal sales calls in which it
pretended to represent car dealers and manufacturers, and  made false
claims that its products offered “bumper to bumper” protection. To
settle the charges, the defendants agreed to a lifetime ban from any
outbound telemarketing business and from any involvement with extended
automobile warranty sales and paid a monetary judgement.

LINK: https://www.ftc.gov/news-events/news/press-releases/2024/10/ftc-sends-more-449000-consumers-harmed-extended-vehicle-warranty-scam?utm_source=govdelivery

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As of July 6, 2023

FTC Action Leads to Industry Bans for Operators of ‘Extended Vehicle Warranty’ Scam

Court order prohibits defendants from all outbound telemarketing activity and from extended automobile warranty marketing

A Federal Trade Commission lawsuit against the operators
of a telemarketing scam that called hundreds of thousands of consumers
nationwide pitching “extended automobile warranties” will result in a lifetime ban from any outbound telemarketing business and from any involvement with extended automobile warranty sales.

The FTC first charged Kole Consulting Group and its
owner, Daniel Kole, as some of the defendants running the American
Vehicle Protection (AVP) operation that scammed consumers out of
millions of dollars in February 2022.
In its complaint, the FTC charged that AVP made unsolicited calls in
which it claimed to be affiliated with vehicle makers and deceptively
claimed its products, which cost thousands of dollars, offered “bumper
to bumper” protection.

The court order in the case, which
the defendants have agreed to, includes the bans from extended
automobile warranty marketing and outbound telemarketing. The order also
includes a monetary judgment of $6.5 million, which is partially
suspended based on the defendants’ inability to pay; Kole will be
required to surrender $500,000. If the defendants are found to have lied to the FTC about the financial status, the full judgment would be immediately payable.

The FTC previously announced a settlement with the other defendants in the case in March 2023.

Link: https://www.ftc.gov/news-events/news/press-releases/2023/07/ftc-action-leads-industry-bans-operators-extended-vehicle-warranty-scam

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As of March 24, 2023

As a result of a Federal Trade Commission lawsuit, the operators of a
telemarketing scam that called hundreds of thousands of consumers
nationwide to pitch them expensive “extended automobile warranties” will
face a lifetime ban from the extended automobile warranty industry and
from all outbound telemarketing.

Under the terms of proposed court orders,
three companies and their owners that were charged by the FTC with
running the operation that scammed consumers out of millions of dollars
would be permanently banned from participating in the extended
automobile warranty market, as well as from any further involvement in
outbound telemarketing.

The FTC first charged the owners and operators of American Vehicle
Protection Corporation (AVP) with violating the FTC Act and the
Telemarketing Sales Rule in February 2022.
In its complaint, the FTC charged that AVP made unsolicited calls in
which it claimed to be affiliated with vehicle makers, and deceptively
claimed their products, which cost thousands of dollars, offered “bumper
to bumper” protection.

American Vehicle Protection Corp.; CG3 Solutions, Inc.; and Tony Gonzalez Consulting Group, Inc., along with individual defendants, Tony Allen Gonzalez, and his
brother, Charles Gonzalez, have agreed to the terms of the proposed
court orders.

The orders also include a monetary judgment of $6.6 million, which is
largely suspended based on their inability to pay. If the defendants
are found to have lied to the FTC about the financial status, the full
judgment would be immediately payable.

The FTC’s case against the remaining defendants in the case, Kole
Consulting Group, Inc., and its owner and manager, Daniel Kole, will
continue.

LINK: https://www.ftc.gov/news-events/news/press-releases/2023/03/ftc-action-leads-lifetime-industry-ban-operators-extended-vehicle-warranty-scam?utm_source=govdelivery

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As of February 9, 2022

The Federal Trade Commission is taking action in federal
court against a Florida-based group of defendants it alleges have called
hundreds of thousands of consumers nationwide to pitch them expensive
“extended automobile warranties” using deceptive telemarketing tactics.

According to a complaint filed in federal district court, American
Vehicle Protection Corp. (AVP) and related defendants bilked consumers
out of more than $6 million over the last four years, pretending to
represent their dealer or car manufacturer, and providing coverage much
more limited than represented.

“AVP blasted consumers with illegal calls and made bogus claims about
bumper-to-bumper warranties,” said Samuel Levine, Director of the FTC’s
Bureau of Consumer Protection. “The
truth is that the warranties didn’t come from the manufacturer, didn’t
cover the repairs people needed, and weren’t sold legally. We are
holding AVP accountable.”

According to the complaint, headquartered in Pompano
Beach, Florida, AVP and several related corporate and individual
defendants violated both the FTC Act and the Commission’s Telemarketing
Sales Rule (TSR) by calling consumers, many of whom were on the Do Not
Call Registry, and attempting to sell them the warranties.

In addition to misrepresenting that they either are, or
are associated with, the consumers’ vehicle manufacturer or dealer, the
defendants’ telemarketers have made false promises that they can provide
“bumper to bumper” or “full vehicle” coverage for prices ranging
between $2,800 and $3,400. They also falsely claimed that consumers can
get a full refund of their down payment or full payment within 30 days
of buying the warranty if they are not happy with it.

In filing the complaint, the Commission is seeking an
order barring the defendants from such illegal conduct, from violating
the TSR through their illegal and deceptive telemarketing, from remotely
creating and depositing remote checks, from violating the DNC Registry
rules by calling consumers whose phone numbers are on the Registry, and
from failing to pay the fees required to access the numbers on the
Registry and scrub them from their call lists.

The defendants include: 1) American Vehicle
Protection Corp.; 2) CG3 Solutions Inc., also d/b/a My Protection Plan
Inc.; 3) Tony Allen Gonzalez, individually and as an owner, officer,
and/or manager of American Vehicle Protection Corp., CG3 Solutions Inc.,
and Tony Gonzalez Consulting Group, Inc.; 4) Tony Gonzalez Consulting
Group, Inc., also d/b/a The Gonzalez Group; 5) Charles Gonzales,
individually and as an owner, officer, and/or manager of American
Vehicle Protection Inc. and CG3 Solutions Inc.; 5) Daniel Kole,
individually and as an owner, officer, and/or manager of American
Vehicle Protection Corp. and Kole Consulting Group, Inc.; and 6) Kole
Consulting Group, Inc.

LINK:
https://www.ftc.gov/news-events/press-releases/2022/02/ftc-charges-florida-based-sellers-deceptively-marketing-extended?utm_source=govdelivery