Pa. sues company for failing to pay on used-car warranties

HARRISBURG -- A former Lackawanna County used-car warranty company is accused of accepting payments from car buyers for warranty contracts, and then closing the business without offering refunds or paying the outstanding warranty claims.
Pennsylvania Attorney General Mike Fisher said his office received more than 70 complaints from people in Lawrence, Allegheny, Greene, Lackawanna, Luzerne, Monroe, Wayne, Westmoreland and Wyoming counties and New York state.
Fisher's office filed a lawsuit in Lackawanna County Court in Scranton to recover more than $116,000 in fines and refunds.
The lawsuit identifies Kevin and Kristen Smith as the operators of Northeast Warranty Corp. in Taylor, Lackawanna County. The suit accuses the Smiths of violating Pennsylvania's Unfair Trade Practices and Consumer Protection Law.
Accusation: Fisher said the Smiths' company offered warranties that claimed to cover repairs performed at any auto repair center and guaranteed the car owner would be reimbursed for the cost. More than 70 people complained that they paid for coverage that was canceled or they were billed for claims that were not honored.
The attorney general said the warranty company closed in September 2000 without honoring contracts and repairs worth more than $45,000.
The suit claims the individual losses range from $135 to $3,555. Losses were also reported by two auto repair centers.
Anyone who may be eligible for money in this lawsuit should contact Fisher's office at (800) 441-2555 or file a complaint online at www.attorneygeneral.gov.