National Dealers Warranty Inc

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BBB Accreditation BBB Rating Business Contact and Profile Business Management Additional Locations and Phone Numbers Customer Complaint History

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BBB Accreditation

BBB Rating

Based on BBB files, this business has a BBB Rating of F on a scale from A+ to F.

• Length of time business has been operating.
• 320 complaints filed against business
• Government action(s) against business.
• Advertising issue(s) found by BBB.
• Business has failed to resolve underlying cause(s) of a pattern of complaints.

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The BBB has received numerous complaints regarding this extended vehicle service contract broker. Complainants primarily allege that the firm engaged in misleading sales tactics, provided poor customer service and refused to cover needed repairs. Other complainants have indicated the firm misrepresented warranty coverage or that they had difficulty canceling contracts and obtaining refunds. These complaint patterns are reflected in the complaint statistics below.

Business Management

Additional company management personnel include:

Mark Travis - Vice President
Nick Hamilton - Secretary
Mike Carter - General Counsel

Based upon information in BBB files, Steve Proetz of this company is also partners with Rick Bartelle of Automotive Warranty Protection. The BBB maintains a separate file for Automotive Warranty Protection.

Additional Locations and Phone Numbers

Customer Complaint History

When considering complaint information, please take into account the company's size and volume of transactions, and understand that the nature of complaints and a firm's responses to them are often more important than the number of complaints.

BBB processed a total of 319 complaints about this company in the last 36 months, our standard reporting period. Of the total of 319 complaints closed in 36 months, 155 were closed in the last year.

Government Actions

On Jan. 9, 2009, the Superintendent of Financial Institutions for British Columbia, Canada issued a cease and desist order for:

World Wide Warranties, Inc. (Missouri), and World Wide Warranties Inc. DBA Canadian Warranty Services, and The Choice - Gold Key c/o Canadian Auto Warranty Services;

Auto Warranty Protection Services, Inc. (Missouri) and Auto Warranty Protection Services Inc. DBA The Choice - Gold Key c/o Auto Warranty Protection Services; and

National Dealers Warranty Inc. (Missouri) and National Dealers Warranty Inc. DBA National Dealers Warranty

AND:

1. Rudge Gilman of Missouri, "as directing and controlling mind of World Wide Warranties Inc., Auto Warranty Protection Services Inc. and National Dealers Warranty Inc.;"

2. Mark Travis of Missouri as "directing and controlling mind of (same as above)

3. Nicholas Hamilton of Missouri (same as above);

4. Richard Brettelle of Missouri (same as above);

5. Steve Proetz of Missouri (same as above).

As part of the order, the Superintendent states that the companies and individuals were not authorized to do business in British Columbia because they did not meet any of the qualifications to do so under the province's Financial Institutions Act.

The order states that the companies listed have been providing vehicle warranty insurance in British Columbia, collecting premiums and advertising "without proper licensing and authorization" under the act.

It also states that the individuals are in non compliance with the act by "conducting unauthorized insurance business in British Columbia."

The BBB maintains a separate file for Canadian Auto Warranty Services.





National Dealers Warranty, a company that sells extended auto service contracts, agreed to settle a lawsuit filed by the Attorney General of Missouri rather than proceeding to trial in the case. In reaching the settlement, the company agreed to pay $4,955 in restitution to four customers and $25,000 to the Attorney General's Office for costs in bringing the lawsuit.

The settlement agreement also requires the company to make fundamental changes in the way that the company conducts business:

1. Informing potential customers that their current warranties are expired unless this statement is true and is followed by a disclaimer stating that this assertion does not take into consideration any extended service contracts that the potential customer may have already purchased;
2. Offering to sell motor vehicle extended service contracts to potential customers without informing them that National Dealers Warranty is not selling an extended motor vehicle warranty;
3. Offering to sell motor vehicle service contracts to potential customers without informing them that National Dealers Warranty is not affiliated with the manufacturer which produced the customers' motor vehicles or the dealers who sold the motor vehicles when they were brand new;
4. Offering to sell motor vehicle extended service contracts to potential customers without giving them, when requested, an opportunity to review the motor vehicle extended service contract form before they agree to purchase same;
5. Omitting to inform potential customers that National Dealer Warranties is merely selling motor vehicle extended service contracts on behalf of a third party who will actually be responsible for administering the motor vehicle extended service contract; and
6. Offering to sell motor vehicle extended service contracts through the use of automated telemarketing calls unless such calls are administered in full compliance with laws including, but not limited to, Do Not Call regulations and laws at the state and national level.


On March 6, 2008, the Missouri Attorney General filed suit in St. Charles County Circuit Court against National Dealer Warranties for sending consumers postcards and letters informing them that they had limited time to purchase renewed, extended warranties for their vehicles. The Attorney General claimed the company neglected to inform consumers that it was not affiliated with the dealer or manufacturer of the vehicle, or that it was offering to sell motor vehicle extended service contracts instead of warranties.

On Nov. 12, 2009, Attorney General Koster filed lawsuits against six vehicle extended warranty companies, including Extended Warranty Corp.

According to Koster, the businesses marketed what appeared to be "extended auto warranties" to consumers, but actually were "service contracts" or "automotive additives." Many consumers did not realize they were not receiving auto warranties until they received the package in the mail. The companies sold the products as service contracts and auto additives with the effect of avoiding Missouri's service contract laws, which provide some minimal protection for consumers.

Customers who purchased "service contracts" often later realized the significant limits to coverage. Many contracts contain a 30 to 90 day, 1,000 mile period during which consumers cannot make claims, because that is considered a "pre-existing condition" of the vehicle. However, the extended service contract is only fully refundable within the first 30 days. Customers asked for a cancellation or refund when they discovered the provider would not pay a claim after that initial period, but were refused refunds because they were not within the 30-day cancellation timeframe. Many of the contracts have also been promoted as extending a warranty for 7 years and 100,000 miles. These companies do not tell the consumer that the coverage may be limited to the actual cash value of the vehicle. For an older, high-mileage vehicle, the coverage may soon be less than the price paid by the consumer for the contract.

For companies using the auto additive scam, customers were sent a bottle of fluid for their car's transmission, engine, or cooling system, with instructions to immediately add it to the vehicle. Customers were instructed to install the additive in order for the warranty to be valid. But they later were denied a refund and told the purchase is non-refundable if the product has been used. In effect, the companies encouraged consumers to use the fluids immediately, knowing that would nullify their opportunity for a refund. Many consumers did not request the additive and did not realize they would be sent this additive until they received the packet.

Koster said the companies marketed these products using misleading letters, postcards, and telemarketing techniques, some also in violation of Missouri's No-Call law. He said the businesses would lead consumers to mistakenly believe their current vehicle warranties were about to expire and that they would not have another opportunity to purchase an extended warranty unless they acted immediately. Many potential customers were not informed that the businesses were not affiliated with the dealership or manufacturer from whom the customers bought their vehicles.

In addition, some of the businesses sought to illegally obtain the consumer's bank account or credit card information by misrepresenting the purpose of the information. The businesses would then cause automatic charges to consumers' bank accounts or monthly charges to their credit cards without the consumers' permission or knowledge.

Koster's suits charge the businesses with unfair and deceptive practices violations. Some were also charged with violations of Missouri's No-Call law. In addition, he charged National Dealers Warranty with violation of a prior Consent Judgment and Permanent Injunction issued by the Circuit Court of St. Charles County in 2008.

Koster is asking the court to issue preliminary and permanent injunctions requiring the companies to comply with Missouri's Merchandising Practices Act; provide full restitution to victims and to the state; and pay civil penalties and court costs.

Advertising Review

The Better Business Bureau has challenged some advertised claims with this company concerning misleading advertising. They have not agreed to modify or substantiate their advertisement.

Industry Tips

Know the Facts About Auto Service Contracts

BBB Copyright and Reporting Policy

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ID: 310030296
Report as of November 22, 2009 11:57
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