FTC Charges Florida-based Sellers for Deceptively Marketing “Extended Auto Warranty” Programs

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 Commission vote approving the filing of the complaint was 4-0. The Commission filed the complaint in U.S. District Court for Southern District of Florida.

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.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. The matter will be decided by the court.