By JAMES FINK
jfink@bizjournals.com | 716-541-1611

Transitowne Hyundai agreed to repay more than $80,000 to customers after the state Attorney General's office found it charged for "free gas" that was offered as a new-car purchase incentive package.

Attorney General Eric Schneiderman on April 8 said that 1,235 Transitowne Hyundai customers will receive refunds after being charged a $65 gasoline fee when they purchased a car from the Town of Amherst dealership, even though the dealer promised free gas with each purchase. As a result of the settlement, Transitowne has agreed to pay $80,275 in restitution and $5,000 in penalties and fines.

The investigation began after a consumer filed a complaint stating he was charged a $65 gasoline fee even though he was promised the same amount in free gasoline for the purchase of a new car. Transitowne Hyundai had displayed on the Manufacturer Suggested Retail Price (MSRP) window sticker that a full tank of gas was included, Schneiderman said.

"If that one person hadn't come forward, hundreds of other consumers may never have known they were overcharged," he said.  

After the initial complaint was filed in January, the Attorney General's office immediately contacted Transitowne Hyundai and requested a check of its records from 2008 to 2011 to determine if other consumers had paid the gasoline fee. The investigation revealed that Transitowne charged 1,235 consumers.

"This was an oversight on our part," said James Hillery, Transitowne Automotive Group president and owner. "We have since corrected the matter and have apologized to our customers."

As a result of the investigation, Transitowne has entered into an Assurance of Discontinuance (AOD). The agreement requires it to identify the consumers who paid the gasoline fee and to provide restitution totaling $80,275.

The case was handled by Assistant Attorney General James Morrissey and senior consumer fraud representative Karen Davis under the supervision of Michael Russo, assistant attorney general in-charge for the Buffalo regional office.