A year after the collapse of US Fidelis, the nation’s largest seller of extended auto service contracts, the Better Business Bureau advises customers to remain extremely skeptical of any company marketing similar after-market contracts.
“We saw hundreds of complaints in 2010 involving US Fidelis and similar marketing companies. Many people felt they were coerced and manipulated into buying repair plans that had little, if any, value,” said Kim States, BBB President. “While some of these sellers appear to have made progress in reducing their numbers of complaints, many still have a long way to go.”
US Fidelis, the bankrupt Lake St. Louis, Mo., firm, continued to accrue complaints in 2010, with about 400 nationally, including eight in Tucson. Next in number of complaints is NRRM Enterprises, LLC of St. Peters, Mo., better known as Stop Repair Bills or StopRepairBills.com. More than 200 consumers have filed complaints against Stop Repair Bills since Jan. 1, 2010. Many claimed they were pressured into buying service contracts they later discovered did not cover their vehicle repairs.
Stop Repair Bills has an “F” grade with the BBB, the lowest possible. Governments in the U.S. and Canada have taken action against Stop Repair Bills and affiliated businesses.
In 2008, then-Missouri Attorney General Jay Nixon sued six companies, including National Dealers Warranty (now Stop Repair Bills), for using “misrepresentation and deception” to sell vehicle service contracts to the public. Five months later, Nixon settled that case with National Dealers Warranty, with the company agreeing to pay about $30,000 in restitution to consumers and for the state’s costs in bringing the lawsuit.
In November 2009, Missouri Attorney General Chris Koster filed a second lawsuit against Stop Repair Bills, accusing the firm, Gilman and other officers of several violations of state law. The case, amended in November 2010, is pending. Allegations include unlawful telephone marketing practices, selling contracts for unregistered providers and administrators, deceptive sales practices, unlawful merchandising practices, unfair trade practices and insurance fraud. Stop Repair Bills sells contracts nationwide.
On its website, Stop Repair Bills says it sells vehicle service contracts for other companies that administer the plans. Marketers like Stop Repair Bills maintain that they only sell the contracts and they should not be held responsible when claims are rejected.
BBB believes that because the marketer enters into the original agreement with the customer and receives payment, the marketer should have ultimate responsibility.
NRRM, which owns Stop Repair Bills, was formed in December 2009 through a consolidation of National Dealers Warranty and Auto Warranty Protection Services. At the time of the consolidation, Gilman was president of both companies. Mark Travis was listed as vice president of both firms; Nicholas Hamilton (more…)