Used Car Dealer to Pay $125,000 for Wrecked Car Scam

PHOENIX – Arizona Attorney General Mark Brnovich announced Discount Auto Sales LLC will pay $125,000 in restitution and attorney’s fees after selling unsuspecting customers previously wrecked cars that had been declared a total loss.

Discount Auto Sales and its owner, Eivan Shahara, admitted to violating Arizona’s Consumer Fraud Act and agreed to pay the State at least $125,000. Consumers who purchased a previously wrecked car from Discount Auto Sales may be eligible for restitution if they file a complaint with the Arizona Attorney General’s Office by April 2018.

The Attorney General’s Office launched an investigation into Discount Auto Sales after receiving approximately 5 complaints from consumers about the condition of the vehicles sold. The investigation revealed that Discount Auto Sales failed to tell consumers about the accident, ownership, and repair histories of vehicles sold to consumers.

From April 2012 to August 2014, Discount Auto Sales purchased numerous vehicles from insurance companies at out-of-state wholesale auctions that specialize in the disposal of damaged and inoperable vehicles. Many of the vehicles Discount Auto Sales purchased at these auctions had been previously wrecked and/or declared totaled by the selling insurance company, but were not branded as “salvaged” or “inoperable” due to loopholes in the other states’ vehicle branding laws. After purchasing the vehicles, Discount Auto Sales would bring the vehicles to Arizona, perform substantial repairs, and then offer the vehicles for sale without telling the public about the vehicles’ adverse histories. Instead, Discount Auto Sales told consumers that it had no knowledge of the accident or repair histories of the vehicles even though Discount Auto Sales had performed the repairs itself.

The court-approved consent judgment prohibits Discount Auto Sales and Mr. Shahara from: 

  • Advertising or selling vehicles that were previously owned by an insurance company, without disclosing how Discount Auto Sales purchased the vehicle, what condition it was in, and what repairs were performed;
  • Making any type of false statement or material omission regarding the condition, repair, or accident history of vehicles offered for sale;
  • Advertising or selling vehicles that have not been inspected for defects.

Before a consumer signs a purchase agreement, Discount Auto Sales must also provide an accurate copy of the car title and disclose whether the vehicle was previously owned by an insurance company.

Anyone who purchased a non-repairable used vehicle from Discount Auto Sales should contact the Attorney General’s Office in Phoenix at (602) 542-5763, in Tucson at (520) 628-6504, or outside the metro areas at (800) 352-8431. Bilingual consumer protection staff is available to assist. Consumers can also file complaints online by visiting the Attorney General’s website.

For additional information, members of the media may contact Mia Garcia, Director of Media Relations at (602) 339-5895 or [email protected].