Delaware and 35 other states have reached a settlement with used vehicle retailer CarMax, which has agreed to pay $1 million over concerns about its reporting of vehicle safety concerns.
The settlement stems from an investigation into concerns that customers were not aware of unrepaired and potentially serious safety recalls in used vehicles.
Delaware will receive $20,589.46, from the settlement. The money will go toward the Delaware Department of Justice’s Consumer Protection Fund, allowing it to do future consumer protection without drawing on taxpayer dollars.
As a result of the deal, CarMax must disclose open and unrepaired recalls related to the safety of its used vehicles before customers buy.
“Requiring disclosure of open safety recalls is essential for Delawareans looking to purchase safe, used vehicles,” said Delaware Attorney General Kathy Jennings.
CarMax will continue to use the National Highway Traffic and Safety Administration’s vehicle identification number tool to provide safety information to consumers.
Consumers can also make use of the tool themselves to check for any open recalls on their vehicles.
The settlement establishes that used car dealers should generally disclose open safety recalls to consumers before they buy.
CarMax must now include hyperlinks for vehicles advertised online and QR codes for vehicles on the lot that link directly to any open recalls on the vehicle so consumers can access the data as they shop.
CarMax will also present customers with copies of any open recalls and obtain the consumer’s signature on a standalone disclosure document before presenting any other sales paperwork.
The company also agreed not to represent vehicles as “safe.”
In a statement Thursday, CarMax COO Joe Wilson said his company led the industry in recall transparency by sharing vehicle-specific recall information in-store and online.
“In fact, as soon as NHTSA made available vehicle-specific recall information in 2014, we began providing the information to customers nationwide and we continue to do so today,” Wilson said.
“As CarMax is not authorized by manufacturers to complete recall repairs and close out recalls, we work hard to ensure our customers have the information they need to take action and have recalls repaired at a manufacturer-authorized facility.”
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