"But this month, more than 168,000 Americans opened their mailboxes to find checks from the Federal Trade Commission, all tied to a case that exposed widespread deception in the vehicle service contract industry. The fallout is substantial: more than $9.6 million headed back to consumers who were misled, frustrated, and often left paying for repairs they thought were covered by CarShield and American Auto Shield."
"This is one of the largest automotive-related refund efforts of the year, and it raises bigger questions about how these companies operate, what consumers should watch for, and whether the settlement goes far enough. As someone who has spent years investigating automotive scams and advocating for transparency in the industry, I can tell you this case reveals a deeper problem that too many drivers face: service contract companies relying on aggressive marketing, overpromised coverage, and fine print that only benefits the company."
More than 168,000 consumers received refund checks from the Federal Trade Commission after a case revealed deceptive practices in the vehicle service contract industry. CarShield and American Auto Shield agreed in July 2024 to pay nearly $10 million to settle allegations of misleading advertising, deceptive telemarketing, and coverage claims that did not match plan terms. Many consumers who paid up to $120 monthly encountered exclusions, denials, and contract language that left them responsible for repairs. Promises of broad repair coverage, free rental cars, and freedom to choose any repair shop frequently went unfulfilled, prompting over $9.6 million in returned funds and renewed concerns about marketing and transparency in the industry.
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