Legal News

Car Warranty "Robo-Calls" Spark Lawsuits and Federal Probe

If you're receiving phone calls with a pre-recorded message telling you that your car warranty is about to expire, and offering to sell you a new extended warranty vehicle service contract, you're probably annoyed. But you're not alone, and a number of federal and state officials are doing something about these so called "robocalls."

According to ABC News, attorneys general in as many as 30 states are investigating the "Your warranty is about to expire..." robocalls, and more than 100,000 consumers have contacted the Better Business Bureau to find out whether the calls are legitimate.

So, are the calls legitimate? One thing's for sure, they're deceptive. That's because the companies making the calls identify themselves as "Warranty Division" or "Dealer Services", trying to dupe consumers into thinking that it's their own vehicle's dealer calling, when in fact it's just a third party company that may or may not be on the level, according to ABC News. And often the "coverage" being offered is so fraught with loopholes and caveats that you're left with no protection.

Indiana Attorney General Greg Zoeller has filed a lawsuit against two telemarketing companies after Zoeller's office received "more than 100 complaints about robo-calls from these telemarketers selling auto warranties or service contracts."  

U.S. Senator Charles Schumer has called for a Federal Trade Commission investigation into the calls, according to the New York Daily News, which says the companies behind the robocalls are "pushing phony car warranties, exploiting worries about the fates of American auto giants Chrysler and General Motors."

Consumers got some enhanced protection from "robocalls" in December 2008, when a new Federal Trade Commission rule took effect, which requires that consumers be given the chance to opt out of future pre-recorded calls from soliciting businesses and charities.

• ABC News: Scamming 'Your Warranty Will Expire' Calls Lead to Lawsuits
• Indiana AG Files Suit Against Telemarketers (IN.gov)
• New York Daily News: Senator Chuck Schumer Wants FTC to Crack Down on Robocallers
• New Rule Lets Consumers "Opt Out" of Pre-Recorded Telemarketing Calls (FindLaw's Common Law)
• Who's Calling? Recognize and Report Phone Fraud (FTC.gov)
• National Do Not Call Registry (DoNotCall.gov)
• Does the Average Member of the Public Have Any Privacy Rights? (provided by R. Steve Bowden & Associates)

Full post as published by FindLaw's Common Law on May 11, 2009 (boomark / email).