PRESS RELEASE FOR IMMEDIATE RELEASE

Contact: Ralph K. Durstein, Deputy Attorney General

Consumer Protection Unit

Phone: (302) 577- 8510

Date: November 13, 2002



PENNSYLVANIA AUTO DEALER ENTERS INTO CONSENT ORDER WITH AG'S OFFICE

Family Chrysler-Jeep agrees to Halt Deceptive Advertising



(Wilmington, DE): A Stipulation and Consent Order to Cease and Desist signed late yesterday by Judge Joseph Slights requires Chadds Ford auto dealer, Family
Chrysler-Jeep (hereinafter "Dealer"), to refrain from advertising which violates Delaware's Consumer Protection laws, announced Attorney General M. Jane Brady.

Despite a warning letter issued to the auto dealer in January, 2001 by the Consumer Protection Unit of the Attorney General's Office, Dealer persisted with
advertisements in a Delaware newspaper which included deceptive pricing and failure to disclose balloon payments for automobile purchases. The State alleged
that Dealer:

Violated Delaware's Consumer Protection Laws by advertising sale prices for automobiles which deceived the public by concealing material facts as
to the actual cost of vehicles; 
Misled consumers in the advertisement of financing for automobiles by omitting material facts such as the interest rate and "balloon payments" due at
the end of the loan term; 
Advertised automobiles at deceptive prices and monthly payments, with no intention of selling the vehicles as advertised; 
Engaged in unlawful trade practices by making false and misleading statements of fact in automobile advertisements concerning the amounts of price
reductions available to the consumer.

For instance, Dealer advertised vehicles with a "cash price" (for example,$19,699) in prominent, bold-faced type. The advertisement also mentioned "$3,500 cash
or trade", suggesting that a consumer would need to pay at least $3,500 down, or trade a vehicle appraised at that value, to purchase the advertised vehicle. In
reality, the buyer was required to pay the $3,500 and the "cash price" (in the example, a total of $23,199 - a far cry from the advertised "cash price"). This
deception prejudiced not only consumers, but also other car dealers, making competing prices seem high by comparison.

Dealer's financing advertising relied on low monthly payments, followed by a substantial "balloon" payment of the outstanding balance, without disclosure of the loan
terms. For example, a Jeep Cherokee was offered for a cash price of $19,194, or for 23 monthly payments of $128, after a down payment of $3,500. But after
two years, the balance due on the balloon note would be $18,892. The customer who paid out $2,944 over twenty-three months would have reduced the principal
balance by only $302!

In 1999, the Attorney General's Consumer Protection Unit assisted the Delaware Automobile and Truck Dealers Association (DATDA) with developing voluntary
advertising guidelines as part of a system of industry self-regulation in Delaware. A condition of membership in the DATDA requires voluntary adherence to these
guidelines. As a result of these guidelines, the quality of advertising in Delaware has improved and the guidelines can serve as a model for other states. According to
the DATDA Executive Director, Marlene Lynch-Petrylak, "our Association and its dealer members are highly committed to ethical and "consumer-friendly"
business practices, and we have worked closely with the Attorney General's office to achieve this mutual goal. 'Integrity' and 'ethics' are paramount to Delaware
dealers, and to our organization."

Under the Stipulation and Consent Order, Dealer agrees to review its advertising practices and refrain from any and all false, misleading, or deceptive advertising.
Dealer also agrees to promote full disclosure to the consumer of cash or trade contributions required of the consumer, as well as the term, interest rate, and
payment obligations of the consumer with respect to any "balloon" payment or unpaid balance remaining on a car loan.

Attorney General M. Jane Brady commented, "We consistently have made it clear that businesses must deal fairly and honestly with Delaware consumers. These
advertising practices hurt individual consumers as well as effect the reputation of the automobile dealer industry. We are pleased that this dealership is coming into
compliance."

The Stipulation and Consent Order requires that a civil penalty of $40,000 and costs of the Attorney General's

investigation of $10,000 be paid by Dealer by the end of the year. 



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NOTE: A copy of the voluntary advertising guidelines is available upon request.