WatchOut! Extended Warranties and Service Contracts
Welcome to WatchOut!, a new feature of Consuming Interests. This is where we invite you to post any scams, shady business practices or deceptive advertising that you have come across and want to let others know about.
I’ll start.
A week or so ago, an FTC official told me about the thousands of complaints the regulators received about robocalls that appear to come from a consumer’s car manufacturer or dealer. The calls warn consumers that their warranty was about to expire, and they need to act immediately to extend their coverage. In reality, the calls were companies trying to sell pricey service contracts for $2,000 to $3,000.
The FTC sued some of these companies last month, including one that sent out postcards.
I told the FTC official I hadn’t received any such calls or mailing. He said I must be the only person in the country who hadn’t.
Yesterday, I joined the country.
I received an official-looking letter in the mail with a REQUEST FOR IMMEDIATE ACTION. The outside of the letter even held this warning: “$2,000 Fine, 5 years imprisonment, or both for any person interfering or obstructing with the delivery of this letter.”
And when I opened the letter, I was told my “factory warranty may have expired or is about to expire,” and that I had until June 15 to extend the coverage. I was approved for 0 percent financing.
When I called, I was told the letter was a pitch for a service contract. When I mentioned the FTC’s recent complaint, the call center said they would have the manager call me back.
To his credit, he did. He said he follows the law and doesn’t have any complaints from Maryland.
That may be true, and his letter may not be as egregious as some of the problems that the FTC sued over. But I don’t consider it an above board solicitation. WatchOut!
Photo courtesy of juhansonin.









Comments
eileen!
i got one of those pesky letters, too, with the exact same language. they must have blanketed the baltimore area. i was just about to blog about this on ConsumerWingman, but you beat me to it. i haven't gotten a call in a while, but i've gotten tons of auto warranty scam letters in my mailbox. i hope the ftc is going after the letters, too!
Hey, Wingman, good to hear from you! - eileen
Posted by: dan thanh | June 10, 2009 9:21 PM