Washington — A Michigan Ford dealership said it agreed to settle allegations of deceptive marketing by the Federal Trade Commission because of the expense of fighting the matter.
“Fowlerville Ford has prided itself on maintaining the highest possible standards in treating its customers and in complying with all laws and regulations in conducting its business. While it could have appealed the FTC’s conclusions through the administrative and court systems, the cost of appealing would have been prohibitive,” the dealership said in a written statement Friday. “Therefore, Fowlerville Ford agreed to the consent order.”
The FTC reached settlements with nine out of 10 dealers nationwide it cited for deceptive marketing techniques. One dealer in Massachusetts — which sells Ford, Kia and Hyundai vehicles — is challenging the FTC complaint.
In its statement, Fowlerville Ford said three years ago it “hired an outside marketing firm to run a sales promotion program. The promotion included an opportunity for customers to win a prize, if a ticket matched a certain number. The odds of winning were stated in the program. The FTC concluded that the disclosure was not specific enough in its opinion even though no regulations had been published defining what kind of disclosure was needed.”
The FTC said in its consent order that since May 2011, Fowlerville Ford sent promotions titled “Match & Win” that said customers could win up to $25,000 in cash — or $1,000 or $5,000. “In numerous instances, consumers have attempted to collect a prize by presenting a card with winning numbers at the Fowlerville Ford dealership. However, no consumer has received any of the prizes advertised in the promotion,” the FTC said.
The FTC complaint also said the Ford dealership failed to clearly disclose the repayment terms of several used car offers.
The dealership said two years ago it was “approached by a local TV station soliciting advertising. The station promised to film an ad at the dealership and to write the contents of the ad. Fowlerville Ford agreed and the ad was filmed and run by the station one or two times. About six months ago, a year and a half after the ad had run, the Federal Trade Commission sent the dealership a letter stating the ad was not in technical compliance with one of the many regulations published by the FTC because the ad did not specifically mention the term, ‘annual percentage rate’ it had instead used the term “percentage rate,” the dealership said.
The dealership quickly changed the term it used, Fowlerville Ford said.
“The FTC requested that Fowlerville Ford not run the ad again and that it use the specific term, ‘annual percentage rate’ when referring to a financing rate. Fowlerville Ford cooperated fully with the FTC and agreed to use the term ‘annual percentage rate’ in all of its advertising that mentioned a financing rate. To the best of Fowlerville Ford’s knowledge, of the hundreds of advertisements it has run during its twelve years of operation, the one the FTC complained about was the only one that was not in technical compliance.”