Skip to page content Skip to site navigation
Home :: Open Government :: News :: 2011 :: July
AG Chris Koster | FAQs
Missouri Attorney General


Browse by month and year

Search by keyword(s)

Attorney General's News Release

July 8, 2011

Attorney General Koster says new auto service contract laws will transform industry -- consumers will know what they're buying; have reasonable time to cancel contracts --

(Jefferson City, Mo.) – Attorney General Chris Koster said a bill signed into law yesterday by Governor Jay Nixon that places new requirements on auto service contract businesses will make big strides in cleaning up an industry that was rife with problems.

“This is a troubled industry that has too many illegitimate players that have given the industry a bad name,” Koster said.

Koster said he commends and thanks Senator Scott Rupp for sponsoring the legislation, and for co-chairing a task force Koster created to recommend new requirements for the industry.

The requirements contained in the new law include requiring sellers of motor vehicle extended service contracts to:

  • Provide a copy of the proposed contract to a consumer before a sale, if the consumer requests to see it;
  • Allow a “free-look” period that allows a purchaser to cancel the contract within at least 20 business days after purchasing;
  • Provide full refunds, minus any claims paid, for cancellation. The seller may charge a reasonable administrative fee in a cancellation, not to exceed $50; 
  • Become licensed; and
  • Not use the word “warranty,” when, in fact, such contracts are not considered “warranties” under law; represent falsely they are affiliated with a manufacturer or dealer; or represent they have knowledge that a consumer’s warranty is expiring.

The Attorney General’s office has maintained 12 lawsuits against auto service contract telemarketers in the last year for the type of business practices addressed in the law. In addition, Koster’s office obtained criminal indictments in June against Darain Atkinson and his brother Cory Atkinson, who owned and operated U.S. Fidelis. The indictments include felony charges of unlawful merchandising practices, stealing, and insurance fraud.

Koster said it is fitting that Governor Jay Nixon signed the law; as then-Attorney General, Governor Nixon filed the first lawsuits against auto service contract sellers using deceptive practices.

Koster thanked Representative Todd Richardson for his leadership in steering the legislation through the House of Representatives, and for Speaker of the House Steven Tilley and Representative Mike Talboy for sponsoring a House companion bill. He also thanked John M. Huff, Director of the Missouri Department of Insurance, Financial Institutions and Professional Registration, for his work on the task force.

State homepage   |    Missouri statutes   |    Forms   |    Site Map   |    Accessibility   |    Privacy Policy   |    Contact Us  Follow AGO on Twitter!  RSS Feed  RSS Feed