State sues Swickard auto group over allegations of false advertisement

Company says it wants to meet with the Attorney General’s office over the matter
State sues Swickard auto group over allegations of false advertisement
Published: Aug. 9, 2023 at 5:33 PM AKDT|Updated: Aug. 10, 2023 at 2:02 PM AKDT
Email This Link
Share on Pinterest
Share on LinkedIn

ANCHORAGE, Alaska (KTUU) - Attorney General Treg Taylor has filed a lawsuit against one of Alaska’s largest car dealership groups for violating consumer protection laws, according to a press release from the Department of Law.

The suit’s complaint alleges that the Swickard auto dealerships in Palmer and Anchorage “engages in unfair and deceptive advertising practices, including advertising vehicles it does not possess to drive foot traffic to its lots and refuses to honor advertised prices,” which began operation in the state between 2020 and 2022.

The complaint stems from three separate instances — identified by consumers in late 2022 and early 2023 and reviewed by the Alaska Department of Law Consumer Protection Unit — claiming that the Swickard dealerships falsely advertised.

According to the Department of Law, Swickard claimed two false advertisements were published unintentionally and a third complaint was because of a single, overzealous salesperson.

One of those complaints involves Joshua Smith, an investigator for the Department of Law.

“What happened was one of our own investigators went to a Swickard dealership to buy a car — his car had broken down and he wanted a new Volkswagen, and while he was there, experienced the same sort of conduct that had been described in those consumer complaints and that’s what lead to our investigation,” Assistant Attorney General John Haley said.

Smith initially interacted with Swickard as a potential customer. However, as Smith began dealing with the company, what he learned eventually triggered an investigation into Swickard.

“Inv. Smith determined that despite his love of Volkswagens, Swickard was a dishonest dealership that he could not do business with. The next day, Inv. Smith purchased a vehicle from a different dealer,” the complaint reads.

An undercover investigation of the Consumer Protection Unit found that Swickard “regularly engages in unfair and deceptive business practices” — including listing cars on their website that are not in their lots or not locally available, and that the dealership does not intend to stock. The Department of Law alleges “Swickard posts these false advertisements to its website for the purpose of bringing customers onto the lot, then selling those customers a different model at a price well above the Manufacturer’s Suggested Retail Price — a classic bait-and-switch tactic.”

Although these cases occurred in the last few years, Haley says it possibly affected a “large number of people.”

“Even if people didn’t purchase a car at a Swickard dealership, a lot of people still saw a false advertisement and had to waste their time coming in, some driving in from a long way away, and then others may have ultimately purchased a car. But I think that we’re talking about fairly pervasive false advertising,” Haley said.

The investigation also found that Swickard dealerships advertised vehicles at or below the manufacturer’s suggested retail price but refused to honor that price at the point of sale. Employees would tell prospective buyers that they would not be allowed to complete the sale without the purchase of dealer add-ons — such as extended warranties, exterior ceramic coating, or door guards — that weren’t disclosed in the advertisement. According to the complaint, employees of the dealerships have complained to the dealership about the unfair practices but no changes have been made.

The complaint seeks penalties of $25,000 for each incident found to be in violation of Alaska’s Unfair Trade Practices and Consumer Protection Act, as well as an injunction to halt the deceptive practices.

“Buying a car is already a stressful process and an important decision for consumers,” Taylor said. “We will not allow car dealerships to engage in illegal advertising and sales practices that make purchasing a car even more difficult for consumers. Nor will we allow unscrupulous dealerships to gain an unfair advantage over their competitors.”

The following dealerships are part of the Swickard group:

  • Mercedes-Benz of Anchorage
  • Swickard Chevrolet Buick GMC Cadillac of Anchorage
  • Swickard Buick GMC of Anchorage
  • Swickard Cadillac of Anchorage
  • Swickard Chevrolet Buick GMC of Anchorage
  • Porsche Anchorage
  • Audi Anchorage
  • Swickard Volkswagen of Anchorage
  • Swickard Buick GMC of Palmer
  • Swickard GMC of Palmer

The entire complaint can be found here.

When asked to comment on the matter Thursday, the Swickard Auto Group provided a statement calling the situation a “misunderstanding”.

“At Swickard Auto Group, we take pride in our privilege to serve the Alaska community. With thousands of loyal Alaska customers relying on our sales and service, we remain dedicated to upholding their trust and delivering the highest standards of service. Our commitment to open and transparent communication has always been fundamental to our operations,” the statement read.

“There is clearly a misunderstanding between us and the Attorney General’s office. We are hoping to have a conversation with the Attorney General’s office to gain understanding of the concerns outlined. Out of approximately 50,000 customers we serve in Alaska, the Attorney General report included three complaints. We believed these complaints had been previously resolved to the customer’s satisfaction,” the statement read.

“We look forward to the opportunity to engage in direct discussions with the Attorney General’s leadership. It is our genuine love and appreciation for the Alaska community that fuels our determination to rectify any misunderstandings and reinforce the trust they place in us.”