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Attorney General sues Heartland Ford

  Consumer Rights  -   POSTED: 2007/03/27 05:43

A lawsuit was filed Monday in Perry County Circuit Court by Illinois Assistant Attorney General Jeffrey M. Feltman on behalf of Attorney General Lisa Madigan and the People of the State of Illinois against Du Quoin's Heartland Ford Inc., Automotive Partners Inc., Illinois Automotive Partners Inc., Peter Iodice and Donald James McPherson alleging consumer fraud and deceptive business practices.

The suit alleges that the company allegedly took vehicles as trade-ins and did not pay the outstanding debts resulting in damages to a number of individuals. 

The suit also alleges the business in many instances didn't pay sales taxes, license and title fees and other expenses that it contracted to pay when people traded in their vehicles to purchase other vehicles.

The suit seeks to enjoin defendants from engaging in any vehicle business in Illinois, to have contracts with harmed people rescinded, and it asks for a civil penalty against each defendant of $50,000 per violation of the Consumer Fraud and Deceptive Business Practice Act.

Feltman said the first priority is assuring that none of the corporations or individuals comprising Heartland Ford is ever allowed to engage in the automobile sales business in Illinois. Along with the injunctions being sought, the state is also seeking restitution and rescission, he said.

Rescission would in essence nullify the outstanding contracts between Heartland and the people whose contracts weren't followed by Heartland and its owners, he said. He said this would require payment of all of the outstanding obligations.

The chancery suit lists a dozen people who allegedly purchased vehicles between April 7, 2006, and June 5, 2006, with the deals including a vehicle trade-in on which they owed from $1,680 to $18,457 but which was not paid off by Heartland as was promised in the deal.

The suit claims that one or more of the individuals suffered damage to their credit ratings, that they have been "dunned" by creditors, that they have had to make payments on both their old and new vehicles, that they have been charged for repairs that should have been covered under extended warranties that they paid for but for which funds weren't forwarded to the appropriate places.

It's also alleged that in one or more cases, the involved parties had their licenses revoked for having no insurance, that they have been driving without insurance because they can't insure vehicles for which they don't have paperwork or that they are unable to get titles and licenses for vehicles.

The lawsuit alleges that Heartland, located at 1355 S. Washington St., was dissolved involuntarily June 16, 2006, after an Illinois Secretary of State Police investigation. According to the suit, Heartland was acquired by Automotive Partners Inc. between Sept. 29, 2005, and Feb. 16, 2006, and ownership transferred to Illinois Automotive Partners Inc. On that February date, McPherson allegedly paid $100,000 to Peter Iodice for a 10 percent interest in the business and since that time they operated as co-owners, Madigan's suit claims.

It further alleges that they operated as owners from then until the business was closed down and during that time they failed to pay off trade-in loans, Department of Revenue taxes, third party gap insurance, extended warranties and license and title fees on numerous vehicles and yet McPherson allegedly deposited money in an account at the Du Quoin State Bank from which he withdrew $100,000 between May 29 and June 15, 2006, despite owing the outstanding debts.

Feltman said those named in the suit are representative of 31 complaints the office has on file from former Heartland customers. He said the investigation led authorities "to the conclusion that litigation was the only option" to assure no more problems occur and that the victims are properly compensated.

The defendants in the case have 30 days to file a response to the lawsuit; Feltman said it is "total speculation" as to how long it will take to resolve the case. It could be completed soon or could last for some time.

In the meantime, he said if others have complaints against the business they should call the attorney general's regional office at 529-6400 for a consumer fraud complaint form and complete and return that form.

Those whose complaints are already being handled, Feltman said, should contact private attorneys to learn what their rights and obligations are at this time regarding the outstanding debts on their vehicles, both new and trade-ins.

Perry County State's Attorney David Stanton said he is awaiting reports from investigating agencies before determining if and what charges he might file. He said the Secretary of State Police and Attorney General's office have been working together on the investigation and filing of the civil lawsuit this week and he anticipates soon having reports that will enable him to determine whether or not criminal charges are appropriate.

According to a recent story the Manchester Times of Manchester, Tenn., Iodice was extradited to Tennessee March 13 and is in Coffee County Jail for contempt of court for allegedly failing to appear in a chancery case there in August 2006 to account for funds and automobiles from the Manchester Chevrolet of Tennessee, Inc. which he formerly owned.

Authorities say Iodice, 57, of Ruby, S.C., recently received a suspended 10-year sentence and was ordered to pay $100,000 restitution to a Ford dealership in Cheraw, S.C., after pleading guilty to obtaining property under false pretenses. Officials said the investigations are continuing.

In the meantime, about a dozen vehicles still remain on the lot of the closed Du Quoin dealership as many unhappy former customers are making two car payments for vehicles either there or in locations unknown, officials said.

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