The consumer protection division of the Maryland attorney general's office has sued a Missouri marketing company and its owners for selling auto repair warranties that didn't provide the coverage promised, the state announced Monday.
Officials said U.S. Fidelis Inc., which used to operate under the name National Auto Warranty Services Inc., sold warranties that were supposed to extend the manufacturer's warranty and provide comprehensive coverage.
Instead the warranties, which cost $500 to $2,000, provided only limited coverage and consumer claims were often rejected, the state said.
Regulators also said that the company and its owners, Darain and Cory Atkinson, violated a Maryland law that forbids businesses from charging consumers for a product and service sold over the phone until they have signed a contract.
Regulators said at least 12,352 Marylanders bought the warranties. The company did not return a phone call for comment.
Seven other states have sued U.S. Fidelis. The company's website says it stopped selling service contracts in December and filed for bankruptcy court protection in March. Marylanders can contact the consumer division at 410-576-6577 for more information.