NYAG secures $1.9M from Nissan dealers on Long Island and NYC

Listen to this article

Five Nissan car dealerships on Long Island and in New York City have agreed to a $1.9 million settlement, New York Attorney General Letitia James said.

The dealers had allegedly overcharged more than 1,100 consumers who wanted to purchase their leased vehicles at the end of their lease term, the AG’s office said.

Investigators from the attorney general’s office said that the dealerships allegedly added junk fees or falsified the price of vehicles between 2020 and 2023.

The agreements announced Thursday require the dealerships to pay more than $1.6 million in restitution to over 1,100 consumers and a civil penalty of $340,000.

“Ignoring agreements and adding bogus fees harms New York consumers, and that is something my office won’t allow to go unchallenged,” James said in a written statement.

“These car dealerships lined their pockets at the expense of hardworking New Yorkers who were trying to have a reliable car to get to work, take their children to school, run errands, and live their daily lives,” she added. “Our investigation and settlement put money back into New Yorkers’ pockets and send a clear message that lying to New Yorkers and manipulating costs with shady tactics will not be tolerated.”

The investigation found that each of these consumers leased their Nissan cars under an agreement that gave them the option to purchase the vehicle for a set amount at the end of their leases. But when the consumers returned to the dealerships when their leases were up to buy their car, the dealerships overcharged them. The dealers either added miscellaneous “dealership fees” or “administrative fees,” or inflated the vehicle’s price on the invoice given to the consumer.

The AG’s office said that some customers were overcharged by as much as $7,000 on an $18,000 vehicle.

Under the agreement, for Long Island specifically, Baron Nissan will pay $204,656 to 186 consumers and a $51,190 penalty. Nissan of Westbury will pay $102,636.07 to 72 consumers and a $19,440 penalty.  The New York City dealers will also pay restitution to its customers, as well as penalties, the AG’s office said.

The penalties vary by dealership based on the number of consumers overcharged and the pervasiveness and severity of the overcharging.

The dealers agreed to audit all deals between the start of the investigation and now, and will provide additional refunds to any of the overcharged consumers that are identified in that audit.

Consumers entitled to restitution do not need to take any action to receive the payment and the dealerships have already begun paying restitution through mailed checks in the full amount of the overcharge, the AG’s office said.

The dealerships agreed to reform their invoicing practices to ensure all lease buyout customers are not overcharged or given inaccurate receipts.

In a statement to LIBN, Nissan Group of the Americas said “Nissan is dedicated to building long-term customer relationships by providing transparent information about its services and how they work.” 

The statement went on to say that customers  “who have financed their lease with Nissan Motor Acceptance Company (NMAC) may decide to purchase their vehicle at the predetermined purchase option price contained in their lease, plus any incidental charges necessary to complete the transaction as identified in the agreement. We expect Nissan dealers to honor the lease agreement. Information for NMAC lessees is available at www.nissanusa.com/owners/benefits/end-of-lease.html. Customers may also contact NMAC at 800-778-4211 with questions about their purchase options.