A DARCARS Honda dealership in Bowie, Maryland, allegedly engaged in “unfair or deceptive trade practices at nearly every stage” of new vehicle sales, according to civil charges filed in July by Maryland Attorney General Anthony Brown.
The state attorney general’s office alleges that the dealership, along with parent company Mariam Inc., which does business as DARCARS Automotive Group, and owners John Rahmangholi Darvish and Jamshyd Darvish violated the Maryland Consumer Protection Act.
The attorney general’s statement of charges says DARCARS Honda deceived customers by adding a fee equivalent to 2 percent of the vehicle’s sales price, misleadingly labeling it as an optional “sales commission.” However, that fee was not a commission, and customers did not know they could refuse to pay it, according to the lawsuit.
Since at least January 2019, DARCARS Honda has advertised misleading prices for new vehicles on its website, and customers have ended up paying above the advertised price, including significant charges for pre-installed equipment and an “Adjusted Market Value” charge, which the statement of charges claims it is just a dealer’s profit margin.
“It’s important that if a car dealership is going to advertise the price of the vehicle, the price includes everything that will be charged to the consumer,” Philip Ziperman, deputy chief of the Maryland Attorney General’s Consumer Protection Division, told Automotive News.
A Bowie Honda The spokesman said in a statement that the “the case is not supported by the record or the facts.”
“Over the past two years, Bowie Honda has cooperated fully with the Maryland Attorney General to respond to his request for information and address his concerns,” according to the DARCARS statement.
A DARCARS spokesperson said they are “prepared to defend our company and our legal practices in court against these baseless allegations.”
The dealership is also accused of illegally financing the sale of add-ons such as the “DARCARS Assurance” and “DARCARS Protection Plan.” The store allegedly included unwanted equipment and products in the sale and failed to clearly list and detail everything customers were paying for, along with the costs.
Consumers should “have the dealer explain everything that’s on that piece of paper,” Ziperman said, and dealers “need to be as transparent as possible with their consumers.”
The Attorney General’s Consumer Protection Division is seeking an injunction to stop the alleged violations and is also demanding restitution, economic damages, penalties and costs for the alleged violations of the Maryland Consumer Protection Act.
A hearing is scheduled to begin October 29th at the Office of Administrative Hearings in Maryland.
If the agency finds that DARCARS Honda of Bowie violated the Consumer Protection Act, it would require the dealership to “cease and desist from engaging in unfair or deceptive business practices” and take corrective action, including providing refunds to consumers, according to the statement of charges. The dealership could also face a fine of up to $10,000 for each violation of the act.
DARCARS Automotive Group, Bethesda, Maryland, ranks 31st on Automotive News’ list of the 150 largest U.S. dealership groups, selling 24,862 new vehicles in 2023.