Key Takeaways
- The FTC and Maryland AG announced a landmark settlement exceeding $78 million in consumer refunds and civil penalties against a Maryland dealership group.
- Several individual defendants — including senior executives and a former general manager — have been named personally, signaling continued aggressive enforcement against individuals.
- The FTC Complaint includes a litany of alleged “illegal” advertising practices and F&I product sale practices that deceived consumers. The enumerated advertising practices closely tracked the issues outlined by the FTC recently in its letters to 97 dealer groups nationwide.
- The proposed order imposes sweeping disclosure and consent obligations applicable to all consumer-facing pricing, financing, and add-on practices.
Background
On April 2, 2026, the Federal Trade Commission (FTC) and the Maryland Attorney General jointly announced a proposed settlement resolving allegations of systematic deceptive pricing and add-on practices at a Maryland-based dealership group. The joint complaint — originally filed in December 2024 in the U.S. District Court for the Eastern District of Virginia — charged the dealership group and several of its entities with years of conduct designed to lure consumers with falsely advertised low prices, only to charge substantially more at the point of sale.
Individual Defendants Named Personally
Notably, the complaint names several individual defendants personally, including the company’s part-owner and president, its chief operating officer, and the dealerships’ former general manager. This reflects a continuing enforcement trend in which regulators pursue individual officers and executives — not just corporate entities — for consumer protection violations. Auto dealers and their management teams should be aware that personal liability exposure is a real and growing risk in FTC and state AG enforcement actions.
Alleged Deceptive Conduct
The agencies alleged the dealership group engaged in multiple deceptive acts, including:
- Advertising artificially low vehicle prices that most consumers could not obtain, because the prices were contingent on qualifying for stacked rebates not generally available;
- Falsely representing that consumers were required to finance through the dealership to receive advertised pricing, even when consumers — including military personnel with credit union financing — had their own financing in place; and
- Charging consumers for unwanted add-on products, including extended service plans, tire and rim protection, and guaranteed asset protection (GAP), often adding hundreds or thousands of dollars to the transaction without informed consent.
Settlement Terms: Over $78 Million in Relief
The proposed settlement requires the dealership group to make available more than $75 million in refunds to consumers who were overcharged between April 1, 2020, and December 31, 2025. In addition, the group will pay a $3.1 million civil penalty to the Maryland Attorney General’s Office — bringing the total recovery to over $78 million. The Maryland AG’s Office will notify eligible consumers, who may confirm their eligibility and submit claims through a refund claims administrator.
Compliance Obligations Under the Order
Beyond monetary relief, the proposed order imposes significant prospective compliance requirements, including:
- Prohibition on misrepresentations regarding vehicle availability at advertised prices, required financing sources, and all other material terms;
- Mandatory clear and conspicuous disclosure of the total price a consumer must pay for a vehicle, exclusive only of required government charges; and
- Affirmative requirement to obtain express, informed consumer consent before imposing any fees or add-on charges.
What This Means for Auto Dealers
This settlement is one of the largest in FTC auto retail enforcement history and underscores that both the FTC and state attorneys general continue to actively scrutinize dealership pricing and F&I practices. This is clearly a part of the same effort outlined in the recent 97 FTC letters sent to dealer groups nationwide and demonstrates the FTC’s (and state AGs’) serious commitment to bringing significant advertising enforcement actions against dealers nationwide. All auto dealers, regardless of size or state, should review their advertising practices, add-on disclosure and consent procedures, and financing representations in light of this action.
ComplyAuto Guardian And DealCheck Ai Can Help
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This alert is provided for general informational purposes only and does not constitute legal advice.