By SDCN Staff
Riverside, CA–A network of car dealerships owned and operated as subsidiaries of CarMax Auto Superstores, Incorporated, one of the nation’s largest used car retailers, has been ordered to pay $1,100,000 to resolve a consumer protection lawsuit involving the sale of used vehicles in California.
The lawsuit alleged CarMax dealerships violated California law by failing to timely submit required documentation to transfer registration and ownership of used vehicles to purchasers.
Under California law, dealers must submit an application to the Department of Motor Vehicles (DMV) to transfer registration within 30 days of the date of sale. The same deadline applies to the transfer of the certificate of ownership, commonly known as the “pink slip,” unless the application is returned by the DMV for missing information.
As part of the settlement, CarMax has agreed to implement and maintain enhanced business practices to ensure compliance with state consumer protection laws. These measures include placing a sales hold on vehicles when the dealership does not have possession of the title or a clear ability to obtain it within the required timeframe, completing necessary smog checks or VIN verifications prior to sale, maintaining sufficient staffing to process ownership transfers, and designating a senior-level manager responsible for overseeing compliance.
The total payment of $1,100,000 includes $900,000 in civil penalties, $150,000 for investigative costs, and $50,000 to support statewide consumer protection efforts. CarMax cooperated with the investigation and has taken steps to address the issues identified. The company resolved the matter without admitting the allegations in the complaint.
The judgment was entered in Santa Clara County Superior Court as part of a settlement of a civil enforcement action brought by Riverside County District Attorney Michael A. Hestrin, along with the District Attorneys of Los Angeles, San Francisco, Santa Clara, Sonoma, and Ventura counties.
