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The �鶹��ý Trade Commission and Maryland Attorney General have charged Lindsay Automotive Group with systematically deceiving and overcharging car-buying consumers for years, costing them millions of dollars in junk fees and unwanted add-on products.

The agencies’ complaint also alleges that Lindsay advertised prices it refused to honor and falsely claimed consumers needed to obtain financing through Lindsay. The agencies’ complaint alleges that three Lindsay dealerships and their management company, along with the company’s part-owner and president Michael Lindsay, COO John Smallwood, and the dealerships’ former general manager Paul Smyth, engaged in pervasive unlawful conduct.

“Auto dealers who trick consumers with bait-and-switch advertising, financing sleights of hand, and unwanted add-ons should expect to hear from the FTC,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC and its state partners will continue working to combat this illegal conduct.”

“Buying a car is a significant financial investment. Marylanders deserve to know upfront how much they will actually pay for a vehicle and should not be surprised by hidden charges that they did not budget for,” said Attorney General Anthony G. Brown. “Our Office will not let car dealerships profit from unfair and deceptive practices.”

According to the complaint, Lindsay regularly advertises deceptive prices on its website and in its advertising, promoting vehicles for sale at a price that is not actually available to the vast majority of consumers. Lindsay employees continue the deception when consumers call, claiming the advertised price is real.

Only when consumers get to the dealership do they learn that the price is hundreds or even thousands more than advertised because they do not qualify for a raft of rebate programs, or because they must pay thousands of dollars in additional fees. One dealership manager cited in the complaint told a consumer that the price on the website “was not realistic” and that “no one would qualify for it because it was nearly impossible to qualify for all the rebates to get to that price.” In fact, Michael Lindsay told Smallwood and others, “we never deliver the vehicle anywhere near the stated price.”

The complaint cites numerous examples in which customers, who sometimes traveled significant time and distance, including booking flights from other states, to get to Lindsay dealerships based on the low advertised prices, were hit with supposedly mandatory fees of thousands of dollars. In other cases, dealership employees simply told consumers directly that the advertised price wasn’t true, according to the complaint.

A sample of Lindsay’s transactions shows that 88 percent of consumers who bought a car from the defendants’ dealerships from 2020 to 2023 paid more than the advertised price—on average over $2,000 more—according to the complaint.

Additionally, the complaint charges that Lindsay’s unlawful conduct didn’t stop at the vehicle’s purchase price. Instead, after consumers navigate the often arduous process of negotiating a price, they then face further challenges when Lindsay deceptively claims that they must finance their car through the dealership.

Lindsay receives what it calls “kickbacks” from financing companies when consumers finance a car through the dealership, according to the complaint. Consumers who arrive at Lindsay dealerships looking to pay cash or with pre-approved financing from another financial institution are regularly told that the advertised price won’t be honored.

The complaint cites multiple instances in which consumers were directed to financing offers through Lindsay that charged higher interest than what they’d obtained on their own—and would cost them thousands more over the life of the loan. A survey cited in the complaint showed that more than a third of Lindsay shoppers were told that financing through the dealer was mandatory to purchase the car or to obtain the advertised price.

Finally, the complaint alleges that Lindsay systematically charged consumers for add-on products—such as extra service plans, tire and rim protection, and “guaranteed asset protection” coverage—they did not consent to purchase or falsely told consumers the add-ons are mandatory. In fact, a survey cited in the complaint shows 68% of consumers were charged for at least one add-on they did not agree to buy or were falsely told was required. These charges often amount to hundreds or thousands of dollars for each consumer.

The complaint charges that Lindsay Chevrolet of Woodbridge; Lindsay Ford of Wheaton; Lindsay Chrysler-Dodge-Jeep-Ram; Lindsay Management Company, LLC; and individual defendants Lindsay, Smallwood, and Smyth violated the FTC Act as well as Maryland’s Consumer Protection Act. The complaint asks the court to stop Lindsay’s unlawful actions and provide redress to the consumers harmed by those actions.

The Commission vote authorizing the staff to file the complaint was 5-0. The complaint was filed in the U.S. District Court for the Eastern District of Virginia.

NOTE: The Commission files a complaint when it has “reason to believe” that the named defendants are violating or are about to violate the law and it appears to the Commission that a proceeding is in the public interest. The case will be decided by the court.

The staff attorneys on this matter are Mary Weaver and Evan Zullow of the FTC’s Bureau of Consumer Protection.