CarShield settlement: $9.6 million sent to customers over false advertising

"More than 168,000 eligible consumers will receive money due to false advertising by a vehicle service contract seller. The Federal Trade Commission announced it will send checks totaling more than $9.6 million to consumers affected by misleading advertising about vehicle service contracts from CarShield. The federal agency said Carshield and American Auto Shield, LLC, reached an agreement in July 2024 to pay approximately $10 million to settle an FTC complaint, according to a press release."

"The complaint alleged the company produced advertisements and telemarketing that were deceptive. It explains that consumers who purchased the vehicle service contracts found that many repairs were not covered. Consumers impacted by the false advertising had made payments of $120 per month for CarShield's service. The advertisements described that all repairs to consumers' vehicles and its systems would be paid for under CarShield's plans. This included providing consumers with a rental car if their vehicle broke down and allowing consumers to choose the repair facility."

"The FTC settlement details prohibit CarShield and American Auto Shield from "making deceptive and misleading statements in future advertisements" regarding their vehicle service contracts. The companies are also required to verify that their endorsers' statements are truthful and accurate. The FTC said affected consumers should cash their checks within 90 days. Consumers with questions about the refund should contact the settlement administrator at 855-298-8877. Frequently asked questions about the refund process can be found on the FTC website."

More than 168,000 eligible consumers will receive refunds after the Federal Trade Commission found misleading advertising by CarShield and American Auto Shield, LLC. The FTC will send checks totaling more than $9.6 million as part of an approximately $10 million settlement reached in July 2024. The complaint alleged deceptive advertisements and telemarketing that promised comprehensive repair coverage, rental cars, and choice of repair facility, while many repairs were not covered. Affected consumers paid about $120 per month for the service. The settlement bars deceptive statements, requires verification of endorsers, and instructs consumers to cash checks within 90 days.

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