Dealer Services Corporation

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Service Contract, Extended Warranty Rip-Offs, Read This First
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This review is based on 1 fact. Yes, there are many other reasons to base the review on. But here is one more you may want to know...

"of like kind and quality"

Don't know what exactly that means? Well, your warranty company and your mechanic do.


Yes, they will replace your failing parts with parts that have not yet failed. The same as going to the junkyard and getting a salvaged part.

Although, in the same sentence they state that the replacement parts may be "new, remanufactured" there is no way you are going to get a new part and there is no way that you will get a remanufactured part even if that part is only a little more money. Not going to happen.

This all means they will leave you holding the bag when the "used" part once again fails. Out of warranty now, OH WELL.

They will send out an adjuster which may take 2 days, then you and the mechanic still need an OK from the main office. So now 3 or 4 days. Read the fine print and you will see this qualifies you for only 1 day of car rental. Not 5 as stated in your book. Read it! Any more days require proof that the part was waited for in which case you will get one more day. Still not 5 days huh.

So if you are like me and for some odd reason the transmission repair takes 2 weeks and your repair people do not work weekends... Expect to pay for 12 days of rental car out of your own pocket.

Why would it take so long...
Well, the mechanic shop has the parts in hand for the repair but the warranty people will not let them do it because it will cost more money than the LKQ used parts.

And you are left holding the bag again.
This is the first repair that they OK'd out of my two dealings with them. So, do you feel like you got your 3 thousand dollars worth from the warranty contract? Or just more problems and more money spent.

Do yourself a favor if you have recently signed on for coverage from one of these companies...

IAP Integrity Automotive Protection, Dealer Services, Mepco, Protective Administrative Services, Advantage Warranty Corporation, Western Diversified Services, Lyndon Property Insurance Company, Royal Administration Services, Florida Service Agreement Company.

GET OUT OF THE CONTRACT before its too late.
Talk with your dealer or mechanic shop and see first who they would use for extended warranty coverage. Avoid the empty promises and pain that dealing with the above companies will inflict on you.
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Unlicensed Lender Gets Exemption For Usury
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SAN FRANCISCO, CALIFORNIA -- The California Department of Corporations, after giving Dealer Services Corporation a lenders license on May 27, 2009, come right back with an administrative warning on 4 weeks after DSC obtained their license.

The Dept. of Corporations states:
This Agreement is made with reference to the following facts:

A. Discover is a corporation in good standing, duly formed and existing pursuant to the laws of the State of Delaware, and authorized to conduct business in California. Discover has its principal place of business located at 1320 City Center Drive, Suite 100, Carmel, IN 46032.


B. After Discover’s decision to submit an application to obtain a lenders license under the California Finance Lenders Law at Financial Code sections 22000 et seq. (“CFLL”), it came to the attention of the Commissioner that Discover has engaged in commercial lending in California prior to the issuance of a Finance Lenders License to Discover.


C. It is the intention and desire of the Parties to resolve this matter without the necessity of a hearing and/or other litigation.


NOW, THEREFORE, for good and valuable consideration, and the terms and conditions set forth herein, the Parties agree as follows:

Dispute Regarding Lending Activity.

The Commissioner contends that Discover’s lending activities to California borrowers were in violation of the licensing requirements of the CFLL. Discover contends that Discover and its officers, directors, shareholders and employees did not willfully or knowingly engage in business as a finance lender without a license in violation of the CFLL.
Discover has not heretofore and is not now making any admission to any violation of the CFLL or any other wrongdoing. Discover intends by the settlement and compromise described herein merely to avoid further dispute with the Commissioner. The fact that Discover entered into this Agreement shall not be binding or admissible against Discover in any action(s) brought against Discover by third parties.

3. Settlement: Discover further agrees that it shall pay a settlement of Sixty thousand dollars ($60,000) to the California Department of Corporations (“Department”);
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bradgrand on 07/06/2009:
Moved From Other Review: Dealer Services Corporation aka Discover DSC pays $60,000 to the California Department of Corporations. The Commissioner contends that Discover’s lending activities to California borrowers were in violation of the licensing requirements of the CFLL.

Discover contends that Discover and its officers, directors, shareholders and employees did not willfully or knowingly engage in business as a finance lender without a license in violation of the CFLL.

The Commissioner will only use the $60,000 to fatten his budget. NOT ONE DIME IS FOR VICTIMS OF DSC.

The Commissioner says this agreement shall not be binding or admissible against Discover in any action(s) brought against Discover by third parties.


DOC never contacted any victims, however they had plenty of discussions behind closed doors with DSC attorneys. WHY ALL THE SECRECY?


3. Settlement: Discover further agrees that it shall pay a settlement of Sixty thousand dollars ($60,000) to the California Department of Corporations (“Department”);
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Dealer Services Corporation Grissom appointed to Head Class Action in California
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RIVERSIDE, CALIFORNIA -- Dealer Services Corporation (DSC/ “Discover DSC”) is being investigated by The California Department of Corporation. Dealer Services Corporation provides commercial inventory financing for car dealers across the nation. Apparently, since 2005 DSC has been loaning money to thousands of California auto dealers without procuring a California Lenders License. This is a direct violation of the California Financial Code. It seems that DSC is a Delaware Corporation conducting business nationwide.

They operate in the State of California with 6 regional offices located in; San Jose, San Diego, Sacramento, Riverside, Norwalk, and Glendale. [snip] unfair business practice could cost DSC investors Million of dollars, in fines, fees, and future loss in revenue.

Company Response 05/22/2009:

On March 3, 2009, Dealer Services Corporation (“DSC”) successfully eliminated frivolous claims of 189 million dollars and a request for punitive damages filed by failed used car dealer Michael Grissom, who previously did business as American Family Auto. The California Riverside County Superior Court granted DSC’s motion to strike Grissom’s spurious allegations for punitive and exemplary damages, as well as his claim for 189 million dollars, as improper and without any factual basis.

Plaintiff Michael Grissom borrowed approximately $200,000 from DSC in order to finance his inventory of used cars, but when his partnership with Alfred King failed, Grissom cynically turned against his partner, lenders, suppliers, and their employees, and filed suit in Riverside County Superior Court blaming everyone but himself.

The Court threw out four previous complaints filed by Grissom, as wholly insufficient, including his spurious claims of breach of fiduciary duty, breach of duty of loyalty, breach of the implied covenant of good faith and fair dealing, and conspiracy. In his final opportunity, the Court has allowed only claims for breach of contract and negligence, and disallowed his $189 million claim and his request for an award of punitive damages. More particularly, the Court found that there were no facts for Grissom to take to trial for unfair competition and lack of lender’s license.

Indicative of his baseless claims, Grissom is on his third set of attorneys and his fifth complaint and now must defend against DSC’s cross-complaint seeking recovery of $370,195.83 in treble damages, plus attorney fees and costs.

DSC vigorously responds to claims by fly-by-night dealerships who borrow money, fail at their business, and attempt to blame DSC and others for their own shortcomings. For further information contact Prenovost, Normandin Bergh & Dawe, a Professional Law Corporation, (714) 547-2444.
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tnchuck100 on 04/30/2009:
1) You should not use a user name that is the company name you are complaining about.

2) This is not really a complaint where you had a specific problem. This should have been a comment posted on the previous complaint.
Slimjim on 04/30/2009:
So? There are hundreds of investigations and suits sponsored by states over jurisdiction and licensing in just about every industry that do interstate commerce. Why is this one relevant more so then the ten listed under it?
Anonymous on 04/30/2009:
Probably posted by the same person who posted earlier about DSC. Again no specific complaint.
Dealer Services Corporation on 04/30/2009:
Maybe I could have given more info.

thank you for your tips.

“Dealer Services Corporation”

California Auto Dealers look to Obama for justice against Unlicensed Lender activity by Indiana base Company.
On July 27, 2006, I was faxed an application from DSC for a flooring line of credit. DSC had earlier explained to me that their interest rate was less than 10%, and I would be foolish to pass up a chance to obtain a credit line at that low of an interest rate. DSC advised me that I needed to apply for $200,000, because that was their standard flooring line for used car dealers.

I received a fax on August 29, 2006, from DSC congratulating me on my $200,000 credit line. A statement arrived on September 8, 2006, claiming I owed $130,257, of which $113,000 was withdrawn, without my knowledge or permission, just two days after the loan opened. I immediately called DSC to ask why $113,000 was taken from my account, but was told that DSC manager Claude Ponce was unavailable and that I needed to check DSC’s website if I had any questions.

A week after I complained, DSC manager Claudia Ponce told me DSC wrote checks on my loan to pay brokers who had given vehicle titles to DSC.

Saying I had been defrauded, she said do not call the police, but allow her to investigate. She said I must continue to pay DSC or I would be out-of-trust. Over the next 45 days I paid tens of thousands of dollars to DSC, even personally delivering payments to their office.

On October 26, 2006, three DSC employees came to my lot, said I was in default and ordered me to stand aside. They repossessed my cars and told me they had put me out of business.

It had been just two months since I had obtained a loan from DSC. Their deliberate and destructive behavior continued by:

• Contacting customers that had purchased cars from me on retail installment agreements and advised that payments must be paid directly to DSC.

• Rewrote consumer contracts for vehicles that I had sold.

While trying to recover the money DSC had stolen from me, I discovered that DSC was an unlicensed California lender. I quickly filed a complaint with the California Department of Corporations (DOC) in March 2007.

I have continued to ask the DOC to assist me in stopping this predatory lender, as I discovered DSC’s illegal activities were continuing throughout the state

I hope this info can save someone from making the same mistake I did with DSC.
Do I Get my California Lenders License Here? on 05/28/2009:
Maybe John should get a passport.

Fuller said. (It’s pretty technical stuff to loan money for two weeks when you hold the title to the car).

In the 2-1/2 years since Fuller started Dealer Services Corp. in 2005, his Carmel firm has racked up loan receivables of $550 million, compared with $776 million reported last year by Automotive Finance Corp., the company Fuller founded and sold to auto auction chain Adesa in 1994. (There was probably over $50,000,000 just in California, but the ex-marine forgot to get a California Lenders License. He made the same mistake when he ran AFC, maybe that was the reason they let him go?)

Finding personnel was not difficult, at least at first. Word quickly spread to Fuller's former company, Adesa's AFC division, several blocks north on Meridian Street. Phone calls from prospective employees poured in. (Fuller began to take every employee he could snatch from AFC. He also opened up offices in the same buildings as AFC and solicited the same dealers as AFC. DSC gave dealers lines of credit of sometimes $200,000 (unusual for a lot that sells 12 cars a month to need $200,000, but hey, what are loan sharks for?)

Fuller snagged his six top lieutenants, who sat in the "war room" and strategized over what they'd always wanted to change while at AFC. (Most likely they didn’t want to be burdened with getting a lenders license).

"It is so far ahead of what's down the street. It's unbelievable," Fuller said. (It’s pretty technical stuff to loan money for two weeks when you hold the title to the car).

By the time DSC had lassoed somewhere around 75 employees from Adesa's AFC-that would be about 20 percent of its staff - Adesa executives had summoned their lawyers. Shots fired. Adesa filed a lawsuit in Hamilton Superior Court against DSC and several former employees who jumped shipped to Fuller's fledgling firm.

Adesa alleged its former AFC workers took computer records and trade secrets to the new competitor. Many of the ex-employees named were relatively low-level workers, and were now staring down the barrel of Adesa's top legal guns.

Fuller was furious. He insists those workers had never signed non-compete agreements, and neither had he, for that matter. Before hiring them, he'd consulted with big-time Washington, D.C., law firm Aiken Gump Strauss Hauer & Feld, which is perhaps better known locally for its work in the ATA Airlines Chapter 11 case. ( A chapter 11 lawyer is useful when you have to repay usurious interest)

Fuller found himself being asked by friends whether it was indeed true that his firm stole information from Adesa. "I said, 'Heck no. I designed it. It's in my head."' (Plus, John Fuller was the smartest guy in town, just ask anyone he pays)

"They were trying to ruin our name," Fuller said. (What name AFC? DSC? SFA? ADC? Discover Dsc? AFC Cal LLC?)

Ironically, he said, he had plenty of dirt on Adesa that could have embarrassed then-CEO David Gartzke. (What dirt, that Adesa was also an unlicensed lender in California? That their loans were usurious? That no one complied with any laws concerning repossessions?)

So with all that baggage, and later an incendiary lawsuit by Adesa against his new company, the ex-Marine struggled to keep his mouth shut. (Quite the Saint)

When his lawyers weren't chasing him with a roll of duct tape, they were drawing up a countersuit, seeking $25 million in damages from his former employer. The two companies settled in late 2005. Among DSC's concessions, it would put 12 former Adesa/AFC employees on leave for up to six months.

AFC also agreed to discuss an agreement so dealers who finance through DSC can more easily make purchases at Adesa auctions. (What, a mutual anti-trust agreement?)

"This is sick stuff," Fuller said of the legal battle, swearing he'll write a book about corporate idiocy after he retires. (I think you’re only allowed pencils)

Looking down the road

With the legal battle in its rear-view mirror, DSC is speeding ahead with growth plans. Before he retires, whenever that is, Fuller wants DSC to have receivables of at least $1 billion, or almost double current level. Toward that end, last month the company inked a three-year, $700 million financing agreement with Deutsche Bank, to boost lending capacity.

One of the more innovative new products is an alternative to the traditional "buy here pay here" vehicle sales model. (This takes some real intelligence)

The latter sends dealers scrambling to jump through repossession hoops when customers don't pay or file bankruptcy. DSC's "Ren'T'Own" gives dealers full ownership rights until the vehicle is paid for. They can separate a delinquent "renter" from his beloved car in a New York minute–no sticky consumer-protection laws to slow things down. (It’s very unfortunate when you have to do something the legal way – Now you can treat a vehicle sold as a rental. Is this similar to sub-letting cars that’s illegal in California?)

"If your payment is not in my office by the due date or the car back on my lot with the keys, I will report the vehicle stolen and you will suffer the consequences," Northland touts in literature to dealers of a portion of the contract. (Great, make the police department and courts do the repossessions for you – plus you get to turn a simple car buyer into a criminal”).

"These used car dealers - I love them," Fuller said. "They are the entrepreneurs of America."As to whether DSC makes much of a ding in Adesa's AFC is yet to be seen. Hockett, however, is bullish.

"It's really exceeded everyone's expectations," Hockett said. "I don't think there's anybody who has a better understanding of the business than John Fuller." JOHN FULLER HE’S OUR MAN, IF HE CAN’T DO IT NOBODY CAN.
AustininDiego on 09/23/2009:
A used car dealer has been making a living for 10 years selling cars at his lot.
DSC walks onto dealer lot, sees a lot full of inventory, and convinces dealer he should use their flooring line. A $50,000 credit line is given, no questions asked by DSC, and tells the dealer his interest rate on the loan is the current Wall Street Journal Rate plus 3.5%.
DSC has dealer sign a UCC1 financing statement. In the fine print it states DSC has rights to “all assets, inventory and future inventory”.
Dealer soon realizes that the interest rate stated by DSC doesn’t include fees; acquisition fee, audit fee, insurance fee, restock fee, late fee. For a $3,000 car he bought at Manheim Auction, within 30 days he owes $200 in fees.
Almost all states have laws regulating pay-day lenders, but the little used car dealer will have to pay interest rates that may exceed 500%. Ouch!
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Posted by on
NATIONWIDE -- There are Companies like Dealer Services, that give our country a bad name! No wonder the world views American corporations as bottom feeding, scum sucking leeches. Big Corporations suck the life out of the small businesses that made Our Country Great! The small car lots that go out of their way to help those of us on limited income get ripped off by these hierarchical wolves, making it virtually impossible for the small businesses to create growth in our communities. Which in fact brings stability to our nation. This is why we are in a Recession. The business ethics of larger corporations in this nation have got to change.

If this country desires a more stable economy, the integrity of major industry needs to be rethought. CEO's and shareholders alike ought to put emphasizes on the well being of this nation, instead of lucrative action alone.
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tnchuck100 on 04/30/2009:
It has been my observation over the last decade that the CEO mentality has been to produce the largest possible profit at any cost. To hell with the corporation in the next quarter.

Quality, if you can find it at all, is in the small mom and pop operations who really desire to acquire and retain customers.

However, as tlgm points out, big corporations will not allow him to survive. That is our fault. We keep feeding the predatory giants.

I am waiting to see the guy on the six o'clock news hold up the sign that finally says it all:

DigitalCommando on 04/30/2009:
Corporate greed is only an ant in the world of greed. The elephant is the Federal Reserve and the secret stockholders who own it. Most people think it is a federal agency, it isn't. It's a private corporation that is dominated by foreign owners. They own what once was America's gold located at Fort Knox. They control and manipulate our interest rates to their benefit, not ours. The national debt could be wiped out overnight with its removal from our shores. Here's a quote from someone you may have heard of.

"If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks... will deprive the people of all property until their children wake up homeless on the continent their fathers conquered... the issuing power should be taken from the banks and restored to the people, to whom it properly belongs."
What conspiracy theory whackjob made that comment?
Thomas Jefferson.
Anonymous on 04/30/2009:
So the OP is ranting about CEO greed. But the subject is about Dealers Services Corp. Where's the complaint about them?
tlgm49 on 04/30/2009:
In all the research I've done on Dealer Services Corp. has financed car dealers across America,dealerships have been stripped of their "pride/financing and inventory" unable to fulfill a commitment to their customers because of unethical practice of Dealer Services in their greed to accept any person without authorization to get customers financed the under handed dealings to make a buck.Some of the dealers just moved on to the next financier but a few have had to close their doors.
RobertThomas on 07/16/2009:
I am having legal issues with Dealer Services Corporation. Any advice would be greatly appreciated.
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