SEC, Justice Dept. investigating FCA over sales reports
After press reports, Fiat Chrysler America (FCA) has admitted that the Securities and Exchange Commission (SEC) and Department of Justice are investigating the company over its sales reporting practices. The Justice Department is investigating whether FCA violated securities law, reported Bloomberg News. The automaker said it is cooperating fully with the federal agencies.
FCA has reported improved year-over-year sales for 75 straight months. In January, two dealerships filed a civil racketeering suit against the company for allegedly asking the dealers to inflate sales figures in return for $20,000 in advertising incentives. The dealers are Napletonês Arlington Heights (IL) Chrysler Dodge Jeep Ram and Napletonês Northlake Chrysler Dodge Jeep Ram in Lake Park, FL. FCA sought to have the suit dismissed, calling the allegations baseless and the product of two disgruntled dealers who have failed to perform their obligations under the dealer agreements.
The federal investigation has publicized FCAês practice of basing sales figures on vehicles sold to dealers, not on vehicles delivered by dealers to customers. That means the figures include service loaner cars.Download Bulletin PDF