Ford Motor Credit Sued in 20 States for Deceptive Lease Practices, Fraud Class-action lawsuits have now been filed against Ford Motor Credit in 20 states, alleging deceptive leasing practices and fraud.
In the lawsuits, Ford was accused of charging undisclosed acquisition fees and of teaching deceptive sales practices to its dealers and their salespeople. (Nov. 1998)
Ford's Payoff-Packing Scheme Three former employees of a Florida Lincoln-Mercury dealer (from 1989-91) described a "payoff-packing" scheme that was used to overcharge customers who had leased through Ford Motor Credit. They said that representatives from Ford Credit told them how to inflate customers' early payoff balances, explaining that their Ford Motor Credit branch would "participate" by refusing to give payoff amounts to customers who requested them. Instead, they were told that customers would be referred back to the dealer for payoff information, giving them "an opportunity to make additional profits" by overcharging their customers.
Five years later, in California, the Sacramento County District Attorney's office received a complaint of overcharging on a lease payoff by a local Ford dealer. Investigators discovered that Ford Motor Credit had been concealing payoff information from its lease customers, so the investigation was expanded to include all early payoffs that occurred at that one dealer over a one-year period. It was discovered that 31 people had been overcharged.
That 1995 investigation of one dealer quickly spread to include eight Ford dealers in that area. When it was over, five of the dealers were accused of overcharging their customers by inflating the early payoff amounts on vehicles leased through Ford Credit. A total of 111 people were entitled to restitution, with some receiving as much as $2,000. (The investigation only covered one year of early payoffs.) Similar investigations were then started by district attorneys in other areas.
Payoff packing is believed to have been a common practice at many Ford and Lincoln-Mercury dealers across the country, since Ford Motor Credit was withholding payoff information from its lease customers.
If you went through an early payoff on a Ford Credit lease, and Ford told you to call the dealer for the payoff amount, be sure to see your lawyer.
Disclaimer Legal Information Is Not Legal Advice This site provides information about the law designed to help users safely cope with their own legal needs. But legal information is not the same as legal advice -- the application of law to an individual's specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation.
Consumer Credit Counseling Information, Debt Management Plan Information, Debt Settlement Plan information, Credit Counseling, Credit Score, Consumer Credit Counseling Service, CCCS, Bill Consolidation, Credit Repair, and Debt Consolidation is not advice, and we recommend you consult a licensed credit counseling agency, debt settlement attorney, and/or licensed debt management plan administrator in your state if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation.
