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BOSTON — About two months after federal officials ordered
five stores to halt certain advertisements, a family-owned franchised
dealership in business for more than four decades agreed to pay $225,000 in
restitution, civil penalties and attorney fees to resolve allegations that it
utilized "deceptive marketing tactics."

Massachusetts Attorney General Martha Coakley announced the
consent judgment against McGee Wholesale Cars, McGee Motorcars and McGee
Chevrolet, which has rooftops in Hanover and Raynham.

According to the attorney general's complaint filed late
last week in Suffolk Superior Court, McGee placed advertisements online and in
print publications that misrepresented the actual prices of vehicles.

State officials said often the advertisements listed
"dealer's cost" rather than the actual retail price, creating what they contend
was the practice of misleading buyers into believing the vehicle was being
offered at low prices that the dealership would not meet.

The complaint further alleges that on several occasions,
dealership employees asked consumers to sign incomplete documents with the
understanding that they would be completed using the negotiated vehicle price,
and later entered information which called for a higher price.

Employees also allegedly charged consumers fees for unwanted
or undisclosed warranties and services, according to the attorney general's
office.

The consent judgment ordered McGee to pay $125,000 in
consumer restitution, $85,000 in civil penalties and $15,000 to cover attorney
fees and costs. The judgment also prohibits deceptive marketing and sales
practices.

Under the settlement, officials indicated the dealership
also will implement a formal training program for all staff members involved in
the sales or financing to educate them on proper compliance with state
regulations.

Coakley's office said the dealership cooperated with the
investigation and, once the investigation was initiated, the store implemented
managerial and procedural changes to address issues raised by the
investigation.

McGee denied all allegations of wrongdoing, the attorney
general said, though the dealership agreed to resolve the matter with the
Coakley's office.

"We are pleased that the company has agreed to provide
restitution to consumers and has taken important steps to make sure that
misleading business practices do not occur in the future," Coakley said.

According to the store website, the McGee dealerships have
been doing business for more than 41 years. Robert McGee and Jamie McKay are
the owners, and the general manager is Imed Chahed.

Back in March, the Federal Trade Commission revealed steps
that seemed to be cracking down on false or exaggerated advertising, as it
recently called into question ads from a group of five dealerships around the
country.

The FTC charged that the ads — which ran on the dealers'
websites, as well as on sites such as YouTube.com — "deceived consumers into
thinking  they would no longer be
responsible for paying off the loan balance on their trade-in, even if it exceeded
the trade-in's value."

"Instead, the dealers rolled the negative equity into the
consumer's new vehicle loan or, in the case of one dealer, required consumers
to pay it out of pocket," FTC officials continued.

Basically, the FTC contends that in these ads, the
dealerships promised to pay off a consumer's trade-in no matter what the
consumer owed on that particular unit.

And the story that evolved can perhaps serve as a cautionary
tale to rooftops all over the U.S.

The dealers named in the FTC's complaints, Billion Auto,
Inc., in Sioux Falls, S.D.; Frank Myers AutoMaxx, LLC, in Winston-Salem, N.C.;
Key Hyundai of Manchester, LLC and Hyundai of Milford LLC, in Vernon and
Milford, Conn., respectively, and which advertise jointly; and Ramey Motors,
Inc., in Princeton, W.Va., all agreed to the FTC's orders that require them to
stop running ads.