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December 17, 2013

LITTLE ROCK – Attorney General Dustin McDaniel filed a consumer-protection lawsuit today against a North Little Rock used car dealer accused of failing to provide a clear title to car buyers, illegally changing the terms of contracts and selling a car without disclosing the vehicle had been salvaged.

Chidi Ukegbu of North Little Rock is accused of violating the Arkansas Deceptive Trade Practices Act and the Arkansas Salvage Title Act. Ukegbu operates America's Pre-owned Selection, formerly known as Scales Auto, at 1200 and 1222 E. Broadway St. in North Little Rock.

(Click here for a copy of the lawsuit.)

The complaint filed in Pulaski County Circuit Court alleges that Ukegbu at least eight times has sold vehicles for which he did not possess a clear title, and then, despite assurances to deliver title to buyers, he has failed to do so. In at least one instance, Ukegbu is alleged to have intentionally concealed the fact that a car had been salvaged. In addition, Ukegbu is accused in several instances of illegally changing agreed-upon financing terms, resulting in a greater cost for the buyer.

“Those who have had the misfortune of doing business with this car dealer have told our Consumer Protection Division that they have been deceived about contract terms or stonewalled when it comes to receiving the clear title they need to register and insure a vehicle,” McDaniel said. “We hope the court provides a remedy for the affected consumers. Our office will continue to take action against those who would violate Arkansas law.”

McDaniel alleges that Ukegbu violated the Arkansas Salvage Title Act when intentionally omitting that a vehicle on his lot had been salvaged. The consumer who purchased the car discovered it had a salvage title when attempting to insure it. Ukegbu later repossessed the vehicle because the consumer did not obtain insurance, even though it was Ukegbu’s failure to disclose the salvage nature of the vehicle that caused it not to be insured.

According to the lawsuit, Ukegbu also ignored consumers’ demands for refunds when it was apparent that he could not provide a clear title to vehicles. Consumers who were promised they would receive titles never did, making it impossible for them to register or insure the vehicles. And since buyers are already paying for the vehicle that cannot be registered, they often cannot afford another.

Additionally, the lawsuit states that Ukegbu or his agents would add terms to contracts already signed by buyers that conflicted with oral agreements reached between consumers and Ukegbu. These would include changes to finance terms that were adverse to the buyer or exclude promises of vehicle repairs.  The suit contends Ukegbu would then attempt to hold consumers to the terms of the agreement, even though it did not represent the mutual assent of both parties.

McDaniel asked the Court to issue an injunction to prohibit Ukegbu from continuing the practices, order him to comply with requests from consumers for refunds, and assess civil penalties.