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Compliance

Philadelphia Dealer to Pay $24K Settlement for ‘Spot Deliveries’

April 23, 2013

PHILADELPHIA — DeSimone Auto Group has agreed to pay $14,000 in restitution and $10,000 to educate the public as part of a settlement for an unfair trade practice lawsuit filed by the state Attorney General, reports CBS Philly.

The dealership allegedly let buyers drive off in a car and then later charged higher financing rates or repossessed the car if the buyer didn’t agree to them. The article does not make clear what consumers were told or promised when they drove off the lots without financing in place. To read the full story, click here.

Comments

  1. 1. The Negotiator - a.k.a. B [ April 23, 2013 @ 01:07PM ]

    The author of this article and the attorney Matt Weisberg are wrong about their definition of "spot delivery." A spot delivery is simply delivering a vehicle without confirmation that a bank will buy the paper. This can happen under many circumstances, but most commonly, outside normal business hours of banks/underwriters, etc, such as late at night and Sundays. Assuming the dealer can find a bank that will buy the paper, everything is gravy. A yo-yo transaction, on the other hand, is when the dealer contracts the customer under terms they know no bank will buy, then bringing them back in to re-contract the deal under a higher rate, or other unfavorable terms. It even states on the fine print of most contracts that the contract is contingent upon the fact that a lender will buy the deal. Using "yo-yo transactions" and "spot deliveries" interchangably is incorrect. For this Philidelphia dealer group to get fined, they must have been doing something really bad... but they obviously got off with a slap on the wrist. Does anyone agree with my assertion about spot deliveries, or am I just crazy??

  2. 2. Mrs F & I [ April 23, 2013 @ 02:27PM ]

    I must agree with Bubba B, a spot delivery in our store is a deal that is closed and delivered on the same day. If the rubber hits the road in our store it stays on the road at the contracted rate.

    The Editor: Thanks guys for pointing that out. We did error in editing down the summary of the aggregated story, and should have clarified the difference between legitimate spot delivery practices and what this dealer was charged with doing. Thanks, again, for spot-checking us on that.

  3. 3. Bubba B [ April 23, 2013 @ 04:13PM ]

    No worries - I wasn't referring to F&I magazine's article, but more the article from the Philadelphia news channel, where they make spot delivering out to be an illegal business practice. Thanks for including this piece - very informative. I like reading the articles about dealers getting nailed... not that I enjoy seeing others get in trouble, but we can all certainly learn from others' mistakes.

    Editor: Hey, thanks for understanding. Even though it wasn't our story, we should know better than to not dig a little deeper to ID what exactly this dealer did. And the original article, which we aggregated, never says why the dealer got his hand slapped. We'll do some checking. Thanks for your support.

  4. 4. Lance Bell [ April 25, 2013 @ 09:16AM ]

    Let me expand on this Bubba:

    What they are reffering to in the article is "taking them off the market." Meaning get the client to sign at any number, rate, ect. that the dealer know they cannot get hoping that they show all of their family and friends so when the time comes to have them "resign'" they will agree to any figure to advoid the embarresment. This is a common pratice in Phoenix, but rarely seen on the East Coast.

  5. 5. anthony [ June 07, 2013 @ 09:16AM ]

    If the finance manager had the customer sign a spot delivery rider, there would have been no settlement. The rider protects the dealer when there is no bank approval.

  6. 6. anthony ciolino [ June 07, 2013 @ 09:16AM ]

    If the finance manager had the customer sign a spot delivery rider, there would have been no settlement. The rider protects the dealer when there is no bank approval.

 

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