Unsolicited Auto Warranty Calls Under Scrutiny Informative - New York Senator Wants Federal Investigation

Review by BokiBean on 2009-05-10
NEW YORK - Unsolicited calls to home and cell phones warning of a final notice and an expiring vehicle warranty are a nuisance and harassment and should be the subject of a federal investigation, a U.S. senator said Sunday.

More and more Americans are receiving calls with a computerized voice saying, "This is the final notice. The factory warranty on your vehicle is about to expire," or something similar, several times a day on their cell or land lines. The calls come even if a person has signed up for the national "do not call" registry.

Now, Sen. Charles Schumer of New York wants a federal investigation into the "robo-dialer harassment."

"Not only are these calls a nuisance, but they tie up land lines and can eat up a user's cell phone minutes, possibly leading to a higher cell phone bill due to overage charges," said Schumer, D-N. Y.

Meanwhile, officials in 40 states are investigating the companies behind the car-warranty calls.

Michelle Corey, president and CEO of the Better Business Bureau in St. Louis, Mo., said the industry is based largely in the St. Louis area and generates thousands of complaints a year.

She said a group of companies began operating in Missouri in the mid-1990s that offered extended repair warranties to people whose manufacturer-issued warranties were about to expire. Within a few years, about 35 firms were offering similar services.

"It's a very lucrative industry," Corey said.

The companies offer contracts akin to insurance policies, pledging to pay for car repairs in exchange for fees paid up front.

The companies call numbers randomly and leave messages telling people that their auto warranties are about to expire — whether or not they own a car.

Some companies also send out cards that mislead recipients into thinking that their vehicle has been subject to a safety recall, Corey said.

If people call back and agree to buy a policy, Corey said, the companies often don't let them see the contract until they agree to pay.

Some scam victims don't learn until it is too late that the deals don't cover many types of repairs, Corey said.

"Some people are losing thousands and thousands of dollars in purchasing a product that turns out to be useless," she said.

The Federal Trade Commission, which already operates the do-not-call list, should work with state and local authorities "to find the scam artists and shut their operations down," Schumer said.

"This is an annoying scam whose perpetrators have found a way around the do-not-call list," he said at a news conference in his Manhattan office. "The FTC has to track them down and then shut them down to put an end to this nuisance once and for all."

Missouri authorities filed a lawsuit last month against one of the largest car-warranty companies, Wentzville, Mo.-based USfidelis, charging that company officials ignored a subpoena demanding that they answer questions about their business.

A spokeswoman for USfidelis, which has more than 1,000 employees, did not return a call seeking comment Sunday, but the company says on its Web site that it stopped making unsolicited marketing calls last year.

"Frankly, we've identified more effective ways of connecting with our customers," the Web site's "Frequently Asked Questions" section says.

USfidelis charges on the Web site that its competitors "use variations on our name and materials, masking their calls by using the USfidelis name, ultimately confusing and alienating consumers."

Corey of the Better Business Bureau said it is often difficult to know who is making the calls, because companies change names frequently and use telemarketing subcontractors.

Schumer, who received a call last week, said a federal crackdown is needed.

"A few states have tried, but we need national action," he said.

Comments:11 Replies - Latest reply on 2009-06-17
Posted by jktshff1 on 2009-05-10:
Boki, VH.
I take these calls occasionally and just listen, lead them on and then just cuss 'em, call them anything I want to, rant and they hang up. Helps me relieve my stress.
Posted by BokiBean on 2009-05-10:
I haven't gotten any of these yet but I saw a discussion about them here the other day. I got a laugh out of NoHandle asking about a warranty for a 1912 Ford, just to give them grief... :D
Posted by Soaring Consumer on 2009-05-10:
Voted helpful.
Posted by madconsumer on 2009-05-10:
sue em.
Posted by Anonymous on 2009-05-10:
Just hang up!!!!
Posted by Anonymous on 2009-05-10:
Shouldn't cut and pastes from the Associated Press be posted in the forums section of this website?
Posted by Soaring Consumer on 2009-05-10:
This is consumer news so I think that it is in the proper place.

I have gotten these calls too in the past, and it definitely appears to be a widespread problem.
Posted by BokiBean on 2009-05-11:
Thanks Soaring!

C2O, you might be right about the post placement, and this could be a long story, but lemme tell you how it came about..somehow I feel like you'll find the time to read it.

I tried to post this information not once, but twice, and both times it would look like it took, but I never saw it on the main page..too weird! So, I started to get nervous.. Next, I tried to email it and it bounced! Now, I am really starting to worry cause this is important information and the people need it!

After much debate with myself over whether I should or shouldn't, I then tried to snail mail the info, even thought I wasn't sure whether it would get there or not..I didn't have a complete address, but nontheless I tried (and letters DO get to Santa without a complete address) and it came back nondeliverable. *sigh* I tell you, I was sweating bullets!

At this point I'm really determined to get this posted so I went to mama's house and borrowed one of her German Owl Pigeons. They haven't been trained as carrier pigeons but I had a long talk to him...looking right into his little intelligent obsidian eyes and he really seemed to understand! I told him the situation and he accepted the task as his mission...he was gone for a long, long time!

When the pigeon came back, I could tell his mission was successful..he was just shredded and exhausted, but somehow I could tell he was also very pleased with himself! He posted it!!!!!!! Hurrah!!!

Now I see that maybe, just maybe he might have filed the info under the wrong category, but I just don't have the heart to tell him..he's so tired and asleep now, and after all, he is just a little bitty bird.

Anyway, that's the story of how the post came about, and I would have voted your comment helpful but I tried and it didn't take, and now the pigeon is so tired, he's just not up to another mission... Thanks though!
Posted by LIGIAA on 2009-06-13:
I used to receive these calls at least once on my cell phone and also on my work number. One day i got really irritated and listened to the end of the message instead of hanging up right away and at the very end it gives you the option to "press this number if you want to be removed from our list". I pressed it and didn't have much hope, but I have not received their phone calls since. It's been over 3 months! Try it, it might just work for you :-)
Posted by BokiBean on 2009-06-13:
Cool LIGIAA! Great advice.

From what I understand just doing a quick search on Google News, Kentucky, Indiana and Texas Attorney Generals have all sued various companies that are making these calls. Hopefully, these calls will become a thing of the past very shortly.
Posted by D. on 2009-06-17:
I get these calls too...when I ask them, "Which car are you talking about" they hang up on me.

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