(Phoenix, Ariz. – June 10, 2004) Some 2,400 Arizona residents who leased autos under Ford Credit’s “Red Carpet” program are eligible to receive about $240,000 back from the company under a settlement announced today by Arizona Attorney General Terry Goddard.
Through its investigation, the Attorney General’s office discovered that when customers ended their leases early, they were sometimes charged an amount to purchase the leased vehicle that was higher than the amount charged by Ford Credit. Dealers would pay the actual purchase price to Ford Credit, but would pocket the extra money. Consumers generally did not know this was happening because the dealers provided the payoff figure, not Ford Credit.
“This settlement eliminates a lending practice that harmed Arizona consumers,” Goddard said. “Ford Motor Credit Company and its dealers are doing the right thing by stopping this, and informing consumers of what their rights are when they end a lease early.”
Consumers for the years of 1991 through 1994 will receive direct notice from Ford Credit, and may qualify for a restitution check of $100. Other consumers may contact the settlement administrator at 1-800-221-3312 or through the following Web site www.gilardi.com to determine if they are eligible for any money.
This multi-state settlement affects about 150,000 consumers in 38 states, and is the result of the cooperation of Ford Credit and the 1,300 participating Ford and Lincoln Mercury dealers, who will pay over $6.2 million in legal fees and costs.
In addition to the monetary settlement, Ford also has agreed to change its Red Carpet lease contract language to clearly explain a consumer’s rights when ending vehicle lease early. The change involves not only Ford Credit branches but also the lending practices at the Ford and Lincoln Mercury stores.