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California AG Sues Paul Blanco's Good Car Company For Illegal Marketing, Financing Practices

LOS ANGELES (CBSLA) — The office of California's Attorney General has filed a lawsuit against a well-known network of motor vehicle dealerships, and its chief executive Paul Blanco, for allegedly engaging in illegal marketing and financing practices.

Paul Blanco's Good Car Company, which operates seven dealerships across the state, including one in Carson, is accused of targeting vulnerable and low-income consumers with subprime credit.

The lawsuit charges Blanco with making false statements on credit applications, including by deceiving lenders about the value of vehicles and the consumer's ability to repay the loans. Prosecutors say this allowed the company to boost their profits through improperly financed sales and increased the risk that the consumers would be saddled with loans they could not afford.

Becerra's office alleges Blanco also tricked customers into paying thousands of dollars for extra add-on products, such as service contracts and GAP insurance, by telling customers the add-ons were required by law, or by simply concealing the extra charge. They claim the company also ran numerous false and deceptive advertising campaigns on television, radio and the internet promising falsely low interest rates, even for consumers who wouldn't normally qualify for such rates to lure unsuspecting consumers to their dealership.

"A car is one of the largest, and most important purchases for many families, allowing people to get to work, school, and connect to their communities," Becerra stated in a press release, claiming Blanco's conduct "put vulnerable families at risk, through deceitful advertising and illegal sales and lending practices."

Putu Blanco, the wife of Paul Blanco and the company's chief financial officer, issued a statement to the Sacramento Bee, calling the action "misguided."

"Our family-run business has helped heard-working Californians who cannot afford or don't have the credit score necessary to buy a car at other dealerships to do so," she stated in part. "Paul Blanco's Good Car Company has rigorous controls and a culture of compliance in place to ensure California regulations are followed and consumers are protected."

Blanco also said the lawsuit references "very old advertising that has not been in place for years."

(© Copyright 2019 CBS Broadcasting Inc. All Rights Reserved. City News Service contributed to this report.)

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