Released: August 05, 2024

Think twice before buying a car-repair contract

Source: Michelle Singletary, Washington Post (Paid Registration)

Like so many service contracts, the devil is always buried in the fine print. So it was no surprise to me when the Federal Trade Commission announced this week an eight-figure settlement with CarShield.

“Instead of delivering the ‘peace of mind’ promised by its advertisements, CarShield left many consumers with a financial headache,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement. “Worse still, CarShield used trusted personalities to deliver its empty promises.”

The FTC said that CarShield, along with American Auto Shield, LLC, the administrator of its vehicle service contracts, agreed to pay $10 million to settle charges of deceptive and misleading advertisements and telemarketing pitches.

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