Colorado prosecutors have filed a lawsuit against Champion Car Warranty, a company based in Colorado Springs, accusing it of fraud.
The lawsuit seeks to halt the company’s operations and secure financial restitution for consumers.
Lawsuit Targets Fraudulent Warranty Practices
Champion Car Warranty is facing accusations of failing to fulfill warranty agreements with its customers.
Consumers reported that the company rejected claims for services that were promised as part of their warranties.
Prosecutors allege that the company unlawfully earned over $2 million by selling faulty or non-existent warranty coverage to customers across the country.
Several customers, including an elderly couple from Saguache, shared experiences of purchasing warranties, only for their claims to be denied when repairs were needed.
The state is investigating the company for its pattern of rejecting legitimate claims and causing financial harm to consumers who paid for services that were never delivered.
Misleading Advertising and False Claims
The lawsuit also highlights Champion’s misleading advertising tactics.
One of the most egregious claims was that the company supported a military charity, with a donation made for each new customer contract.
However, an investigation revealed that the company made only a single $100 donation, which later bounced.
Prosecutors claim the company’s false representation of its support for veterans misled consumers, especially in Colorado, where many military families live.
Additionally, Champion promoted inflated customer ratings and industry recognition, which were later proven to be fabricated.
The company falsely advertised its services as being accepted by all dealerships and local mechanics nationwide, offering features like 24/7 roadside assistance and a 30-day money-back guarantee—claims that were never honored.
Previous Legal Issues and Unlawful Practices
Yedid and Anteby are no strangers to controversy.
The pair has been linked to other failed warranty businesses in different states, all of which have faced numerous customer complaints.
Companies like Patriot Warranty and Napa Warranty, operated by the same individuals, have also been the subject of investigations for deceptive business practices.
Moreover, Champion Car Warranty failed to obtain the necessary legal certifications to operate in Colorado, including the required motor vehicle service contracts.
The state’s lawsuit aims to hold the owners accountable for violations of the Colorado Consumer Protection Act and secure compensation for affected consumers.
