The Federal Trade Commission said it has charged Budget Rent-A-Car Corp. with failing to disclose to prospective renters that it failed to inspect automobiles subject to recall notices within a reasonable period of time and make the necessary repairs.
The agency at the same time said it had reached a consent agreement with Budget, which agreed to make the inspections and repairs on a timely basis.Jody Wilson, a spokeswoman at Budget's corporate headquarters in Chicago, said the company had no immediate comment on the FTC announcement.
According to the government's complaint, Budget rented automobiles to its customers that were subject to recall notices.
The company allegedly did not inspect these vehicles within a reasonable period of time after the recall notice to determine whether they contained safety-related defects and, where appropriate, repair the vehicles. Budget then failed to disclose these facts to prospective renters or purchasers of the vehicles, the FTC said.
Under the consent agreement, Budget will inspect and repair the vehicles within 120 days of receiving a recall notice.
Alternatively, if Budget chooses not to inspect, the order would require Budget to disclose to prospective renters that the vehicles are subject to safety recall notices and may contain defects.
The proposed consent agreement, scheduled to appear in the Federal Register on Jan. 3, will be subject to public comment for 60 days, after which the FTC will decide whether to make it final.
A consent agreement is for settlement purposes only and does not constitute admission of a law violation.
When the FTC issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $10,000.