STATES URGE FTC TO STRENGTHEN "USED CAR RULE"

MADISON - Attorneys General of forty-two states and territories are asking the Federal Trade Commission to strengthen "Buyer's Guide" notices to indicate if used cars, trucks or SUVs that are for sale have been assigned titles indicating past flood or collision damage.

Under the FTC's "Used Car Rule," Buyer's Guide notices must be posted on used vehicles offered for sale. The current Rule requires Buyer's Guide notices on used vehicles to tell prospective buyers whether the car is offered with a warranty, or is being sold "as-is," without a warranty. The states said the Rule should be modified to go farther.

"The warranty information is valuable for used-car buyers," said Wisconsin Attorney General J.B. Van Hollen. "But the rule's value is limited by the fact that it does not require notice about a vehicle's damage history and prior use. Nothing diminishes the market value of a used vehicle more than detrimental history."

Amending the Buyer's Guide to require this information would help prevent fraud and omissions of material fact, such as its damage, title, and Lemon Law History.

Damaged vehicles also may pose safety hazards to consumers. Manufacturers void warranties on vehicles with damage histories. Wisconsin already requires prior-damage information to be disclosed on their Buyer's Guide. The FTC approved the Wisconsin regulation.

"There simply is no excuse for the national Buyer's Guide to fail to include vehicle history and title brand information," said Van Hollen. "That information is readily available to dealers through private data sources and through title records accompanying vehicles they purchase at auction or take in trade. If Wisconsin dealers are required and can determine facts sufficient to make that disclosure, so too should dealers in the rest of the nation."

The states' "Comment" was filed by the Attorneys General of 40 states and two territories: AZ, AR, CA, CO, CT, DE, FL, GA, ID, IL, IN, IA, KS, KY, LA, ME, MD, MA, MI, MN, MS, MO, MT, NV, NH, NJ, NM, NY, ND, OH, OR, RI, SC, SD, TN, VT, WA, WV, WI, WY, he District of Columbia and the Northern Mariana Islands.

A copy of the comment filed with the FTC is available below: