Consumers Receive Restitution Payments for Dealerships’ “Bait and Switch” Tactics

For Immediate Release
May 13th, 2002
Contact: DDA Andrea L. Burke
(714) 347-8739

Consumers Receive Restitution Payments for Dealerships’ “Bait and Switch” Tactics

SANTA ANA — The Orange County District Attorney’s Office, the Los Angeles District Attorney’s Office, and the Attorney General’s Office have begun mailing out restitution checks to the more than 1,000 consumers who were eligible for compensation due to  “bait and switch” tactics by two dealerships.  A case settled and filed in Los Angeles Superior Court earlier resulted in South Coast Toyota and South Bay Toyota paying more than $1.5 million plus interest in restitution. Shigeyasu Hiraiwa was president of the companies but sold them early last year.

The lawsuit alleged that the dealerships switched customers from a financed purchase to leases without the customers’ knowledge.  Misrepresentations where made regarding the leases being a “lease-to-own” or “lease-to-purchase.”

Some 100 consumers who filed complaints with the respective prosecuting agencies early on will be compensated for the majority of their loss.  Others will receive between $600 and $1,400 in compensation.  Although the prosecuting agencies cannot represent individuals to make them whole, they were successful in obtaining some restitution for consumers.

The case was investigated by the Orange County DA’s Consumer Protection Unit, the Los Angeles County DA’s Office, the Attorney General’s Office, the Department of Motor Vehicles, and the Los Angeles County Department of Consumer Affairs.

In September 1999, the DA’s Office began looking at South Coast Toyota after receiving three consumer complaints.  At that time, the LA DA’s Office had been investigating South Bay Toyota, which was owned by the same person. The Attorney General’s office had also been looking at the dealerships and the three agencies consolidated their investigations.