Dan O’Brien Kia, of Harmony, N.H., should pay $1.25 million to the New Hampshire lawyer common to resolve allegations of unfair and misleading practices on the dealership.

The settlement requires Dan O’Brien Kia to “adjust to a sequence of strict injunctive phrases over the subsequent 5 years to make sure customers are protected against comparable practices sooner or later,” in accordance with the New Hampshire Division of Justice’s Dec. 19 written launch.

These phrases embrace:

  • Reimburse the lawyer common $49,209 in authorized prices.
  • Rent an unbiased compliance monitor to assessment and report on its enterprise practices for the subsequent 5 years.
  • Document audio and video of financing discussions between workers and clients.
  • Pay restitution to 2 customers who had been victims of the misleading practices.
  • Implement workers coaching program to coach them on state client safety legal guidelines.

The Shopper Safety and Antitrust Bureau was investigating Dan O’Brien Kia Harmony primarily based on a excessive quantity of client complaints filed between 2019 and 2021.

The bureau discovered dealership workers “persuaded customers into buying autos they might not afford utilizing misleading gross sales practices; falsely inflated client revenue data on mortgage purposes; and solid the signature of a buyer on mortgage paperwork.”

In response to the lawyer common, the dealership enrolled clients with poor scores in a “credit score restore” or “credit score rehabilitation” effort generally known as “this system.” It was a six-month financing program used when a buyer advised the dealership they could not afford the cost phrases.

Clients had been knowledgeable they certified for “this system,” the lawyer common’s workplace charged, and in the event that they paid their automobile mortgage on time for half a 12 months, their credit score rating would enhance and the phrases may very well be refinanced. However it was nothing greater than a gross sales pitch not affiliated or endorsed by any financial institution, regardless of the dealership saying it was. As an alternative, clients had been left with loans they had been unable to pay.

As well as, Dan O’Brien Kia was inflating the incomes of potential debtors on their mortgage purposes to extend their approval probabilities with lenders. If a borrower was denied funding, the dealership would typically resubmit their utility with the next month-to-month revenue than the shopper really had with a view to win approval.

The investigation discovered one occasion of a mortgage doc with a solid buyer signature. The dealership worker who solid the signature additionally enrolled the shopper in insurance coverage merchandise they beforehand had refused.

Along with different phrases, inside 30 days of when the courtroom authorised the judgment, which was Dec. 15, the dealership should submit the title of a third-party candidate to function its unbiased compliance monitor, mentioned Brendan Garod, New Hampshire senior assistant lawyer common.

“As soon as they’ve chosen a candidate, we approve that candidate,” Garod advised Automotive Information. “That monitor can have common reporting necessities.”

The monitor will spend time within the dealership investigating and submitting frequent stories to the lawyer common’s workplace, he mentioned. Dan O’Brien Kia should enable the monitor to assessment a set variety of offers chosen at random, present the monitor with requested paperwork and make workers out there for interviews — all to make sure the dealership is in full compliance and never participating in any misleading practices.

Dan O’Brien, president of the dealership, was an Automotive Information 40 Below 40 award winner in 2018, at age 33. He was acknowledged for taking on the shop when it had common new-car month-to-month gross sales of 25 items and rising gross sales to 137 items inside 5 months.

O’Brien owns Dan O’Brien Kia North Hampton as effectively, additionally in New Hampshire. That dealership was not concerned within the allegations leveled by the state lawyer common.

In a 2018 Automotive Information story, O’Brien recalled all through his profession “seeing common managers and principals in places of work obscured by tinted home windows. He vowed then that if he ever bought to run a retailer, he’d by no means try this.” Solely his retailer’s finance supervisor had an workplace, he mentioned.

A dealership consultant refused to remark when reached by cellphone Monday.