A Massachusetts car dealership illegally charged Black and Hispanic customers hundreds of dollars more for remote starters, paint protection and other add-on products than it did for white customers, the state attorney general’s office said.
The complaint filed in Essex Superior Court alleges that Jaffarian Service Inc. engaged in unfair, deceptive, and discriminatory pricing practices in violation of the state’s Consumer Protection Act and the Public Accommodations Law, which prohibits race discrimination.
“Purchasing a vehicle is already a significant financial decision for many families and individuals – the last thing they should be worried about is unfairly paying more for a product because of their race or national origin,” Attorney General Maura Healey said in a statement.
Haverhill-based Jaffarian, which sells Volvos and Toyotas, appears to have charged Black and Hispanic customers, on average, about $500 more and $400 more respectively for add-on products than white customers, the complaint alleges.
The sales practice resulted in more than $170,000 in improper profits for the dealership in a two- year period, the complaint alleges.
The suit seeks restitution for affected customers.
In a statement, Jaffarian said it has never received a complaint from any customers. “We emphatically deny the allegations in this lawsuit and have been cooperating fully with the Attorney General’s Office since they first contacted us,” Jaffarian’s attorney, Christopher J. Marino said.
The dealership said the allegations do not appear to be based upon individual complaints and it appears the AG’s Office “picked Jaffarian’s dealerships randomly.”
In another case, the parent company of two Mazda dealerships in Massachusetts has settled with the state’s attorney general for $350,000 after being accused of discriminatory financing and insurance practices against Black and Latino customers. The two dealerships’ parent company, Hometown Auto Framingham, operates North Shore Mazda and Wellesley Mazda. It “vehemently denies” the claims, and states it settled with the state because continuing to fight the case would “take more of our valuable time away from our customers and their automotive needs.”
Despite Hometown Auto Framingham’s denials, Massachusetts Attorney General Andrea Campbell says her office’s found clear patterns of discrimination. Documents analyzed between Jan. 1, 2016, and March 31, 2018, showed that, compared to white customers, Black customers of the two Mazda dealerships paid an average of $280 more for the same add-on products, including extended warranties or protection services. For Latino customers, it was an average of $197 more.
Hometown Auto Framingham says its own lawyers, Charles River Associates, analyzed the same data given to the AG’s office and came to a contrary conclusion. It also claims that the AG’s office would not share its report or identify its experts when asked.
The settlement is not limited to the aforementioned $350,000 fine. For the next three years, the two dealerships must have fixed margins on all products relating to financing and insurance. It can adjust these margins down, but not up.
“Consumers need to know that their race or ethnicity will have absolutely no effect on the type of service they receive from Massachusetts auto dealerships,” Campbell said in a statement. “We will continue our advocacy to ensure all consumers are being charged for services equally and fairly.”
If you have discriminated by a Massachusetts car dealership on the basis of race, contact the Law Offices of Renee Lazar at 978-844-4095 for a FREE case evaluation.