WASHINGTON-Four years after Sears, Roebuck and Co. paid $200,000 to settle multistate charges of automotive repair fraud, more states have begun to pass laws aimded at curtailing shady practices at service facilities. Repair fraud remains a persistent problem-and one of consumers' biggest complaints-but states whose laws have been in place a few years have begun to see results.
According to the Washington-based National Association of Attorneys General (NAAG), 24 states plus the District of Columbia have laws requiring written estimates of repair costs, and customers must authorize repair costs that exceed the estimate.
A few of those laws were adopted in response to the Sears scandal.
But the association reports that automotive grievances-including repair fraud-have been the largest complaint category for three straight years.
The charges against Sears led to the creation of an Auto Repair Fraud Task Force by the NAAG, as well as a $200,000 settlement by the retailer in July 1992.
The task force used part of the money to develop legislative proposals for the states, which were released in the form of a report last October.
Delaware this year passed the first law in response to that report. The law requires a written estimate if a repair is more than $150. If the final repair cost exceeds the estimate by 10 percent, the shop must get the customer's permission to continue the work, said Lawrence Hecker, president of the Motorist Assurance Program (MAP), an industry coalition formed to combat auto repair fraud.
Six more states-Arkansas, Connecticut, Georgia, Kentucky, Pennsylvania and South Carolina-considered but did not pass similar bills in the 1996 legislative session.
Florida, deciding against waiting for the attorneys general report, passed a law a year after the Sears settlement. The statute, which took effect in September 1993, created a Bureau of Motor Vehicle Repair to monitor garages and required all repair facilities to register with the state. The law also requires:
A written estimate for repairs of more than $50.
Disclosures on the estimate and repair invoice.
Customer authorization of repairs exceeding the price on the estimate by more than 10 percent.
Florida also prescribes penalties of up to $1,000 per violation.
``Complaints are increasing because consumers are more aware of repair fraud,'' said Paul Driggers, chief of the Florida Bureau of Motor Vehicle Repair.
Bureau staffers have been speaking to school and community groups on the law and distributing brochures as part of a campaign to promote public awareness.
Fines and consumer refunds continue to increase. ``If our performance (in the law's enforcement) continues,'' said Mr. Driggers, ``we could see $150,000 in consumer refunds paid this year.''
The bureau is writing 60 to 80 fines per month, he said.
State officials are taking steps to encourage widespread compliance. For example, they are working with major suppliers of repair forms so that estimates and invoices allow space for required disclosures.
``It will probably be fiscal year 1998 before the complaints level off,'' Mr. Driggers said, ``and start declining as consumer education efforts start taking hold.''