Wilson Ford’s Business Tactics Subject of Probe : Investigators Claim Sales Staff Trained to Lie, Cheat and Pressure Customers

One of Southern California’s largest auto dealerships conspired to defraud consumers, first with false advertising delivered by television pitchman Ralph Williams and then with sales representatives trained in deceit, a state investigator contends in court documents filed Friday.

The documents, examined by Orange County Superior Court Judge John J. Ryan last week before he authorized a warrant used to search Wilson Ford in Huntington Beach on Sunday, described the dealership as a business where teams of sales people worked to “wear down” and “manipulate” customers.

“It appears . . . Ford is stealing hundreds of thousands of dollars from car buyers” by “relying on the vulnerability of the car-buying public,” state Justice Department investigator Carlos C. Martinez said in a report that was among the documents.

Investigators contend that Williams’ ads lured customers into the dealership by offering cars at below-factory-invoice prices, when Williams knew that once they arrived, salespeople would lie to them and get them to sign contracts with hidden costs and inflated prices for such things as buyer-protection plans.

In addition to the Martinez report, the documents filed Friday include statements from former Wilson Ford managers and sales personnel, written complaints from customers, and reports from undercover investigators who had posed as car buyers while wearing hidden microphones.

Martinez, who is leading a multi-agency investigation of Wilson Ford, offered statements by former employees who maintain that the dealership’s managers train sales personnel in weekly meetings to deceive and manipulate customers. One employee identified Williams as the person directing Wilson Ford’s day-to-day operations.

No one has been charged in the case. JoAnn Black, a supervisor with the Department of Motor Vehicles investigations office in Orange County, said that investigators are studying the documents they seized and had not yet decided on the next course of action. She said no individual, at this point, could be described as the major target of the investigation.

Williams, who has owned car dealerships in Texas, Washington state and Canada, as well as in California, became well-known in the early 1960s when he began plugging his Orange County dealership up to 70 times a night on television.

However, he has had occasional troubles with law enforcement authorities and officials who regulate car dealerships. In Washington, he still owes consumers millions of dollars that were awarded in a judgment against him related to a dealership in Seattle, according to Jay Uchida of the Washington state attorney general’s office.

His dealer’s license has been suspended twice in California and the DMV in 1983 refused him a salesman’s license based on a contention that he had made sales at Wilson Ford without a license. That decision was eventually overturned, however, by an administrative law judge. Williams now has a valid sales license.

Marshall G. Mintz, the lawyer who represents the dealership, said that Williams has no ownership interest in the dealership.

Neither Williams nor the owners of Wilson Ford could be reached for comment. Mintz and Rock Armstrong, Wilson Ford’s business manager, said they could not comment on Martinez’s allegations because they had not read the documents.

Mintz said the dealership has remained in compliance with a $50,000 judgment that the state attorney general’s office obtained in 1986. That judgment prohibits the dealership from engaging in numerous misleading practices, including deceptive advertising.

“It has never been called to Wilson Ford’s attention that it was not complying with the judgment,” Mintz said.

During the search last Sunday, which lasted more than 5 hours, investigators removed from the dealership huge amounts of computer software and hardware and written records, some of which were retrieved from trash cans and a dumpster behind the dealership. The list of the seized documents filled 55 pages.

A statement from a former employee that was included in the documents filed Friday said that original quotes to customers were always done on paper or on computer printouts that were never given to the customers. The salespeople were instructed, he said, to throw away the paper or printout as soon as a deal was closed.

In a typical case cited by the former employees, quotes given customers were inflated intentionally, so that it would appear later in the negotiations that the dealership was making concessions. After a verbal agreement had been reached, the customer was presented with a written contract with different figures. If they questioned the discrepancies, their concerns were discounted.

In 1986, after the state judgment against the dealership, the documents said, salespeople were told to run credit checks even on customers who wanted to pay cash for their cars so that state employees or undercover law enforcement personnel could be detected.