The car dealership network AutoNation Inc. has agreed to pay $650,000 in fines and overhaul its policies to settle a six-county lawsuit — including three from the Bay Area — over tardy title transfer practices that prevented used car buyers from officially owning their vehicles, authorities said.
District attorneys in Santa Clara, San Francisco, Sonoma, Los Angeles, Riverside and Ventura counties sued AutoNation alleging that 42 of its dealerships violated laws requiring them to alert the DMV and begin transferring a used car’s title, also known as a pink slip, to the buyer within 30 days of purchase.
The alleged delays meant that the buyers could not officially claim the cars as their property if they wanted to resell, refinance or offer the vehicles as loan collateral. Investigators estimate that there have been thousands of delayed transfers going back to 2019.
According to several of the district attorney’s offices involved in the lawsuit, the terms of the settlement entail no admission of liability and include $450,000 in civil penalties, $150,000 in investigative costs and $50,000 that will go toward state consumer protection programs. Santa Clara County Superior Court Judge William Monahan signed the settlement, which was filed Tuesday.
AutoNation will also be required to “create and enforce policies so that they will received registration and paperwork in a timely manner,” according to the settlement terms. That includes stopping any car sale without ready access to the title; requiring smog check and VIN verification prior to a sale; having sufficient staffing to process title transfers and a manager tasked with compliance; and deferring sales commissions on purchases where a timely transfer is not feasible.
“People who buy cars with their hard-earned money rightfully expect to receive ownership on time,” Santa Clara County District Attorney Jeff Rosen said in a statement.
San Francisco District Attorney Brooke Jenkins added in a statement, “I am pleased that these dealerships made changes that will minimize the number of problems that may arise in the future.”