Approximately 1,400 customers who purchased a vehicle from Auto Plaza USA will receive relief after wrongly being led to believe they had paid all taxes at the time of the sale, Attorney General Andy Beshear announced today.
Under a consent judgment entered in Fayette Circuit Court, the United Group Inc., also known as Auto Plaza USA, formerly of Nicholasville, and its owners will pay more than $450,000 to resolve a 2017 lawsuit Beshear filed over alleged violations of the Kentucky Consumer Protection Act.
According to the lawsuit, between 2012 and 2016, Auto Plaza USA represented to consumers that the price of the vehicle included all fees and taxes, but then submitted insufficient tax amounts on nearly 1,400 sales transactions. As a result, customers received delinquent tax notices from the state and were left owing tax bills they believed had already been paid through Auto Plaza USA.
Beshear said individual refund checks totaling more than $214,000 will be mailed to approximately 700 consumers who paid the delinquent taxes and another $175,000 will be paid to the Kentucky Department of Revenue to resolve any taxes, fees or penalties still owed by an additional 700 customers.
“I am proud that our office was able to secure restitution for every customer,” Beshear said. “Every Kentuckian impacted will either receive their money back or have their outstanding taxes reconciled.”
Beshear said Auto Plaza USA, which did not seek renewal of its dealer license and closed in late 2017, will also pay to cover the Commonwealth’s cost of the litigation and make sure any future customers are treated fairly by being presented correct vehicle pricing information and disclosing in writing any disclaimers regarding fees or taxes.
After more than 100 consumer complaints were filed with the Office of the Attorney General and the Better Business Bureau (BBB) of Central and Eastern Kentucky, Beshear’s office began investigating Auto Plaza USA.
Kim Sweazy, director of operations for the BBB serving Central and Eastern Kentucky said, “The Better Business Bureau applauds the action of Attorney General Beshear’s office in this matter. We are proud to partner with his office to help protect and fight for consumers in the Commonwealth.”
“The Better Business Bureau has been an outstanding partner in the endeavor to help every Kentuckian impacted,” Beshear said. “In working with our local partners, like the Better Business Bureau, and law enforcement we will continue to protect Kentucky families from dishonest businesses and scammers.”
Beshear and the BBB also encourage Kentuckians looking to purchase a vehicle to research auto dealers at BBB.org and read reviews online.
Beshear’s office is charged with enforcing Kentucky’s Consumer Protection Act, which protects Kentuckians from unfair, false, misleading or deceptive acts or practices in trade or commerce and from scams.
To date, settlements and civil litigation from Beshear’s consumer protection efforts have resulted in over $28 million to the Commonwealth’s general fund. These actions have yielded restitution that could exceed more than $95 million, representing amounts paid to consumers or amounts Kentuckians are eligible to receive, and the value of credits, student loan debt relief and warranty extensions.
Beshear’s office stands ready to help Kentuckians who need to file a business or consumer complaint. To get started, visit http://ag.ky.gov
Kentuckians receiving refunds or the release of outstanding tax obligations will be contacted by Beshear’s office in September once the defendants have paid all amounts due under the judgment.
(provided by Commonwealth of Kentucky Office of the Attorney General)
