Car warranty scams have become a growing issue, with telemarketers aggressively targeting consumers through robocalls, emails, and mail. These scams often promise to extend or renew a vehicle's warranty at a low cost, but in many cases, the offers are fraudulent. Understanding how car warranty scams operate and knowing the red flags can help you avoid becoming a victim.

How Car Warranty Scams Work

Car warranty scams typically start with an unsolicited phone call, text message, or letter claiming that your vehicle's warranty is about to expire. The telemarketer will use high-pressure sales tactics to convince you to purchase an extended warranty or renew your existing one. However, many of these auto warranty scams involve either fake warranties or contracts with extremely limited coverage that don't protect you from expensive repairs.

Red Flags of Auto Warranty Scams

Here are some signs that you might be dealing with an extended auto warranty scam:

• Unsolicited Calls: Legitimate companies rarely cold call or send texts. If you receive an unexpected call about your car's warranty, it's a strong indication that it could be a scam.
• Urgency and Pressure: Scammers often create a sense of urgency, telling you that your warranty is about to expire and you need to act immediately to avoid costly repairs.
• Vague or Limited Information: Scammers tend to avoid giving detailed information about their company or the warranty's terms. If they refuse to provide specifics, it's likely a fraudulent offer.

Examples of Extended Car Warranty Scams

In recent years, several high-profile cases have demonstrated just how widespread extended car warranty scams are:

• FTC Lawsuit (2023): The Federal Trade Commission (FTC) filed lawsuits against several companies for operating auto warranty scams. In one case, the operators were fined $6.6 million for making deceptive robocalls to consumers and misrepresenting their products as legitimate extended warranties. This case also involved the use of "spoofed" phone numbers to make the calls appear as though they came from reputable sources.
• Roy Cox Jr. and Michael Aaron Jones Case (2022): The Federal Communications Commission (FCC) imposed a $300 million fine on telemarketers Roy Cox Jr. and Michael Aaron Jones, who ran one of the largest extended auto warranty scams in the country. They made billions of robocalls to unsuspecting consumers, falsely claiming to represent major car manufacturers and dealers.

How to Protect Yourself

If you're interested in purchasing an extended warranty, here are some steps you can take to avoid scams:

1. Contact Your Dealer: Always reach out to your car dealer or the manufacturer directly to verify your current warranty status.
2. Verify the Company: If you're considering purchasing an extended warranty, research the company online to ensure it has a legitimate reputation.
3. Check for Red Flags: Avoid any company that uses high-pressure tactics, refuses to provide clear information, or demands immediate payment.

Call Us for a Free Consultation

If you believe you've been targeted by a car warranty scam or have already fallen victim to one, our law firm can help. We specialize in handling auto warranty scams and can assist you in recovering any losses or pursuing legal action against fraudulent companies.

Contact us today for a free consultation to discuss your case and explore your options. We'll fight to protect your rights and hold scammers accountable.

Sources:

• How to avoid car warranty scams - ConsumerAffairs
• Extended auto warranty scam statistics - ConsumerAffairs

You may also like:

• Protection Plans, Extended Warranties, Q & A

• The 2024 CarShield Lawsuit: What You Need to Know About the FTC Complaint