Consumers in all 50 states report the company used misleading tactics to sell vehicle service contract of dubious value
April 23, 2009 – Chicago, IL – Consumers across the United States are alleging that Wentzville, MO-based US Fidelis, a company touting itself as “America’s leading provider of extended auto warranties,” pressured them into buying expensive and unnecessary vehicle service contracts from which they received little or no benefit.
In the past three years, Better Business Bureaus around the country have received a total of more than 33,000 inquiries and more than 1,200 complaints nationally from consumers expressing dissatisfaction with US Fidelis or its services. Consumers say that in some cases they spent thousands of dollars for extended warranties and still ended up paying thousands more for repairs that were not covered under plans sold by US Fidelis. A number of state attorneys general across the country have also taken complaints from angry consumers alleging the company’s business practices are unethical and misleading.
“The sheer volume and serious pattern of the complaints involving US Fidelis are troubling,” said Steve J. Bernas, president & CEO of the Better Business Bureau of Chicago and Northern Illinois. “Consumers have been saying they were pressured or misled into buying warranty contracts they don’t want or don’t need and don’t seem to address many repair issues.”
US Fidelis calls itself a “faith-based company” with a “commitment to treating every customer with honesty and integrity.” Its logo, topped by a shining halo, can be seen in national television commercials.
“I bought the warranty after I saw a commercial. They asked me for an initial down payment of $150 and said that future monthly payments would be $109. They would only let me pay through a debit card. They took out the first $150. The next withdrawal turned out to be almost $200 instead of the $109 that I was quoted. They corrected that. I brought the car in for the first claim and was told it was denied because it was a pre-existing situation. This was impossible—I bought the car new off the showroom floor and had never had a problem. I explained that to the customer service rep and he insisted that he was not going to pay the claim. I filed a complaint with the BBB in St Louis and they got me a refund and the company agreed to cancel my policy,” said Floyd Barnes, a US Fidelis customer from Chicago.
The company – previously operating under the names Dealer Services and National Auto Warranty Services – is owned by Darain and Cory Atkinson, two brothers from St. Charles County, west of St. Louis. Chris Riley was recently named the company’s chief executive.
Records show the company, founded in early 2003, sells extended vehicle service contracts across North America. US Fidelis’ TV and Internet commercials ask car owners to call a toll-free phone number for information. The company also has solicited customers by mail and by phone, and BBB notes consumers are especially critical of letters and postcards that appear to be associated with their manufacturers’ warranties. Riley has stated that the company has recently stopped making outbound telemarketing calls.
The nature of complaints against US Fidelis ranges from rude and uncooperative sales representatives to the company’s refusal to provide consumers with copies of coverage contracts before purchase. Some consumers allege contracts were written to make it extremely difficult to obtain payment for repairs. Others said repairs they thought should have been covered were not.
BBB offers the following advice for dealing with firms offering extended auto warranty contracts:
- Never give personal information, including Social Security, bank or credit card numbers, over the phone to an unknown telemarketer.
- Read your manufacturer’s warranty and contact your dealer or manufacturer to ensure that you are not purchasing duplicate coverage.
- When considering an extended service contract or any other type of telephone solicitation, insist on getting a contract in which all terms and conditions are clearly explained before signing up or providing credit card or other payment information.
- To find trustworthy auto warranty companies, consumers can check out FREE BBB Reliability Reports online at www.bbb.org.