The Crittenden Automotive Library

Announced Actions for January 9, 1998

Agency: Federal Trade Commission
Date: 9 January 1998

Consent agreements given final approval: Following a public comment period, the Commission has made final consent agreements with the following entities: Toyota Motor Sales, U.S.A., Inc.; Volkswagen of America, Inc. (including its Audi of America division); Lou Fusz Automotive Network, Inc.; Bommarito Oldsmobile, Inc.; Suntrup Ford, Inc. and Suntrup Buick-Pontiac-GMC Truck, Inc.; and Beuckman Ford, Inc. All seven companies were involved in automobile leasing, and the Commission action makes the consent orders binding on the respondents.

The agreements with the two major automobile manufacturers and five St. Louis Missouri-area dealerships settle charges that the companies omitted or buried key cost information in small, and at times, unreadable print in their automobile lease advertisements. The consent agreements with Toyota and Volkswagen prohibit the companies from misrepresenting the total amount due at lease signing. In addition, ads that state any charge that is part of the amount due at lease signing or that no such charge is required (not including a statement of the periodic payment) also must state with equal prominence the total amount due at leasing signing. In addition, the agreements require these manufacturers to make key information clear and conspicuous in accordance with the advertising requirements of Regulation M.

The dealerships -- Lou Fusz, Bommarito, Suntrup, and Beuckman -- are prohibited from misrepresenting costs of leasing, including the total amount due at lease signing. As in the orders against Volkswagen and Toyota, these dealers' ads cannot state any amount due at lease inception or that no such amount is required (except for the statement of a periodic payment) unless the advertisement also states with equal prominence the total amount due at lease inception. The orders also require the dealers to provide certain important information clearly and conspicuously. The dealers' orders require compliance with all provisions of the Consumer Leasing Act and its implementing Regulation M and the Truth in Lending Act and its implementing Regulation Z.

The Commission vote to make these orders final was 3-0, with Commissioner Mozelle W. Thompson and Commissioner Orson Swindle not participating. (See news release dated October 7, 1997, for more information about the orders; Docket Nos. Toyota -- 952 3098; Volkswagen -- 972 3141; Fusz -- 952 3204; Bommarito -- 952 3202; Suntrup Ford -- 952 3200; Suntrup Buick-Pontiac-GMC -- 952 3201; and Beuckman -- 952 3207.) Staff contact is David Medine, Bureau of Consumer Protection, 202-326-3224.

The Federal Trade Commission has approved a consent order with Ashland, Inc. The order settles FTC charges that the ads for the Valvoline Company's Teflon-containing TM8 Engine Treatment product were false and unsubstantiated. Valvoline is an unincorporated division of Ashland. The settlement bars Ashland from making unsubstantiated claims about the performance or attributes of any engine treatment in the future and from misrepresenting tests or studies used to support its claims. The Commission vote to approve the final consent order was 3-0, with Commissioner Mozelle W. Thompson and Commissioner Orson Swindle not participating. (See news release dated October 8, 1997; FTC File No. 962 3072.) Staff contact is Robert Frisby, 202-326-2098, or Jonathan Cowen, 202-326-2533.

Copies of the documents referenced above are available from the FTC's web site at http://www.ftc.gov and also from the FTC's Consumer Response Center, Room 130, 6th Street and Pennsylvania Avenue, N.W., Washington, D.C. 20580; 202-326-3128; TTY for the hearing impaired 1-866-653-4261. To find out the latest news as it is announced, call the FTC NewsPhone recording at 202-326-2710.

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