ARB investigation leads to $1.875 million judgment against Viva Motor Sports, Inc. for selling non-California certified vehicles

Sacramento – Thanks to an investigation launched by the ARB in 2006, the Los Angeles County Superior Court in June issued a $1.875 million judgment against several companies for importing and selling non-California certified motorcycles and off-road recreational vehicles.

Defendants in the case include Viva Motor Sports, Inc., of Los Angeles, along with DEC 26, Inc., BH Motorsports, Inc., Nitro Motorsports, Inc, and their associated businesses, all based in the Los Angeles area.

“There are plenty of great motorcycles that meet clean air standards. Most dealers know this and carry only bikes that have their California smog certificate. Those who try to cut corners put themselves in a lose-lose situation,” said ARB Chairman Mary D. Nichols. “Violators pay penalties and damage their reputations while putting public health at risk.”

The companies will pay a total of $268,000 and the balance of the fine will be stayed, pending no further violations. In addition, the defendants are permanently enjoined from acquiring, offering for sale, or selling uncertified motor vehicles for use, registration, or resale in California and falsely representing that a vehicle is certified.

During routine inspections of area retail establishments in 2006, ARB investigators observed a variety of all-terrain vehicles and on-road motorcycles for sale that were not certified to California’s strict emissions standards. Investigators traced the models to their importers, Viva Motor Sports, and the other cited companies. Hundreds of the vehicles had already been sold to California residents. While many purchasers returned them for refunds, those who chose to keep them are subject to “registration stops” which prevent future registration in California.

Vehicles that do not meet California’s tough emission requirements create higher amounts of smog-forming pollutants, which can then exacerbate respiratory ailments and negatively affect other health conditions.

The Air Resources Board is a department of the California Environmental Protection Agency. ARB’s mission is to promote and protect public health, welfare, and ecological resources through effective reduction of air pollutants while recognizing and considering effects on the economy. The ARB oversees all air pollution control efforts in California to attain and maintain health based air quality standards.

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Auto Dealer Fraud
Did you know Auto Dealer Fraud is ranked as the number one consumer complaint throughout the nation? Dishonest car dealers are deceitfully swindling average consumers of thousands of dollars. You may be a victim and not know it. For an average consumer it is often difficult to determine whether or not they have been victimized. Since there are so many forms of Dealer Fraud, an average person can easily be defrauded. Auto Dealer Fraud categories include: misrepresentation of title, false advertisement, misrepresentation of vehicle history, financing fraud, packing payments, negative/trade-in equity, contract confusion, and selling prior rental, wrecked, or marked vehicles without disclosure or as new vehicles.

Contract Confusions
Contract fraud is perhaps the most discrete form of auto fraud. Since an average consumer is unaware of the many deceptive tactics that dealers use, they could be bound into paying hundreds of dollars. An average consumer is manipulated through various tricks, including rewriting/backdating contracts; signing more than “one” document in an attempt to charge a higher down payment, higher APR (Annual Percentage Rate), etc.; forging customers’ signatures; failing to provide translations of the completed lease or purchase contract in the applicable language; packing the contract with add-ons such as a service contract, warranty options, and accessories including alarms, GAP insurance, paint/fabric protection, window etching or low jack, items the customers don’t need.

Rewritten Contracts/Backdating: This occurs when a customer does not qualify for financing under initial contract terms. Therefore, the customer may have to consent to increase in down payment, higher APR, etc. in order to qualify for a loan. The dealership deceitfully has the customer sign a second contract with different terms and backdates the second contract with the date of the initial contract, thereby, charging interest for a time period in which the contract is not yet in effect. Not only is the act of backdating illegal, it is also a violation of the Automobile Sales Finance Act (ASFA), which requires that all parties sign one document.

Financing Fraud
Consumers are routinely billed hundreds and sometimes thousands of dollars by fraudulent car dealers. These schemes are designed to extort the highest possible profit from each sale. Dealers use many tactics, including negative equity/trade-ins which a transaction where the consumer is falsely led to believe that the dealership is valuing the trade-in vehicle at the same amount as what is owed. However, in reality the actual cash value of the vehicle in trade-in is less than the amount owed. This difference is added to the cash price of the new vehicle and as a result consumers ends up paying more in taxes and registration. The consumer is also duped when they are told they do not qualify for a loan under the original contract terms and therefore must pay a higher down payment or APR. Often customers end up paying for add-ons (such as alarms, service contracts, GAP insurance, paint/fabric protection, window etching, lo-jack, etc.) that they don’t necessarily need.

Used Car Fraud
Used Car Fraud occurs when the seller fails to disclose prior vehicle history (such as prior accidents, or rentals, etc); misrepresents title (often by selling a “salvage” title); or odometer fraud, where an odometer is illegally rolled back, replaced, or started over.

Negotiating in a Foreign language
California law provides that if a customer negotiates a lease/purchase of a vehicle primarily in Spanish, Chinese, Korean, Tagalog or Vietnamese, the dealer must give consumer a translation of the final contract in the applicable language before the contract is signed.

Odometer Fraud
Odometer fraud is the most prevalent form of auto fraud, resulting in costs of thousands of dollars. Odometer fraud occurs when illegal changes are made to the mileage shown on a used vehicle’s title and odometer. Examples of odometer fraud include roll back, replacement, or having an odometer rolled through all digits and started over.

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Douglas man arrested,

charged with acting as

car dealer without license

( CURBSTONER IN CAR DEALER LICENSE SLANG )

November 18, 2009

A 54-year-old Douglas County man was arrested Wednesday on a warrant charging him with selling cars with bogus odometer readings and acting as a car dealer without a license.

Nevada Department of Motor Vehicle’s Compliance Enforcement Division investigators said they had received several complaints alleging William Wilkins was selling cars in which odometer readings were not accurate, and that he was not a licensed car dealer.

Investigators worked with the Douglas County District Attorney’s Office which resulted in Wilkins being charged in a warrant with six counts of obtaining money under false pretenses, one count of concealment of a salvage brand on a title and one count of being an ex-felon in possession of a firearm.

No further details were known about the allegations, or the nature of how the cars were being sold.

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Posted: November 19th, 2009
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