CarShield ordered to pay $10 million federal settlement over deceptive repair coverage ads

[BumRushDaShow]

Source: NBC News

July 31, 2024, 3:40 PM EDT


CarShield, a company that sells vehicle service contracts to automobile owners that it claims will cover the cost of certain repairs, has agreed to pay $10 million in a settlement with federal regulators over charges that its marketing tactics were deceptive and misleading.

In a statement Wednesday, the Federal Trade Commission said CarShield, which employs celebrity endorsers including rapper and actor Ice-T and sports commentator Chris Berman, had falsely lured customers with the promise of “peace of mind” and “protection” from the cost and inconvenience of vehicle breakdowns through its contracts.

The FTC also charged American Auto Shield, LLC (AAS), the administrator of CarShield's vehicle service contracts, in the scheme. The agency said that at least one ad, which ran 18,000 times on television, stated, “With CarShield’s administrators, they make sure you don’t get stuck with expensive car repair bills like this.” It also touted CarShield contracts as “your best line of defense against expensive breakdowns.”

Yet many purchasers discovered that their repairs were not covered, despite making payments of up to $120 per month for CarShield's product, the FTC said.

Read more: https://www.nbcnews.com/business/consumer/carshield-must-pay-10-million-federal-settlement-deceptive-ads-rcna164540

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Link to FTC PRESS RELEASE - CarShield, Nationwide Seller of Vehicle Service Contracts, to Pay $10 Million to Resolve Federal Trade Commission Charges of Deceptive Advertising

[PSPS]

1. Any third-party warranty or "extended warranty" is a scam. These car and house ones are especially bad.

[mobeau69]

2. Shocked!

[hlthe2b]

3. Honestly, if they have the $$ to pay for Car Shield, they should just pay it into savings each month...

Odds are, it will be there when they need it and no less likely to cover the amount owed than these crooked companies.

[Prof. Toru Tanaka]

11. Odds are that many people do not.

But I am sure the friendly folks at Car Shield would have no problem with them putting it on one of their credit cards. Especially if they made it an automatic payment. So they’ll have peace of mind and no worries that their automatic payment to Car Shield is now carrying the credit card interest rate, also.

[Hermit-The-Prog]

15. Your method will not lead to prices being raised for repairs! Communist! Socialism!

We must all do our part to feed the various and sundry parts of the insurance industry lest the execs have to make do with fewer Ferraris, Lear jets, and pool boys!

[keithbvadu2]

4. Got a Spam call from bull crap extended car warranty.

Got a Spam call from bull crap extended car warranty.
I asked him what was the name of the company and he told me.
Let me look you up on the internet. Didn't take him long to hang up.

[multigraincracker]

5. My favorite question for those calls...

Well, Bob can you give me your phone number so I can call you back. They either hang up or tell you they are not allowed to give the phone number. Then you can tell them that is the test for scams. Works.

[keithbvadu2]

6. Got one a few minutes ago. Kept asking him if he could speak english.

[multigraincracker]

7. One time I got a call about a Master Card.

Guy sound like a local, but I had to screw with him.
Told him I don’t sign up for anything a some non-American is selling. He swore he was an American. I said if you are an American male, who plays third base for the Yankees. He didn’t know and gave up on me.

[LiberalFighter]

8. Will Ice-T and Vivica A.Fox be gone too?

I really hate the CarShield ads.

[democratsruletheday]

12. Ice T and Chris Berman....

Berman comes off like the ahole he's rumored to be. Long time reputation as a blow hard

[oasis]

16. "Listen to your Auntie Vivica and get Car Shield

before it’s too late “.

[Mosby]

9. The FTC or someone should investigate the BBB.

Obviously they can be and are paid off by large companies.

[twodogsbarking]

10. It's something. Have they stopped?

[Bengus81]

13. I'm..I'm so shocked!! Gosh...I believed every word of those ads,even when they used celebrities...

I'm shocked that it took this long to BUST them. The BS Better Business Bureau needs to be looked into if not SHUT DOWN. They have a history of BS'n people.

[Talitha]

14. If it seems too good to be true....

[58Sunliner]

17. What a surprise.

[KS Toronado]

18. Exactly what I was wondering about, from the link........

Finally, the order imposes a $10 million monetary judgment against CarShield and AAS, which will be
used to provide refunds to defrauded consumers. The full amount of the judgment must be paid to
the FTC within seven days of when the court enters the order.

[BradBo]

19. No shit Sherlock.