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Turlock Midas owner barred from ever owning another repair shop
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The Modesto businessman who owned the Midas store in Turlock, as well as 21 other stores in the state, has reached a settlement with the California Attorney General that will cost him $1.8 million and bars him from ever running another auto repair shop in the state.
The California Attorney General’s Office said Maurice Irving Glad was operating a bait-and-switch scam where in he “deceptive lured” in customers with low-cost brake specials then charged them hundreds of dollars more for unnecessary repairs.
Under the settlement agreement reached on Monday, Glad is prohibited from owning or operating auto repair shops in California and he has to pay $1.8 million in damages, investigative costs and attorney fees.
“The Department of Consumer Affairs has zero tolerance for consumer fraud,” said California Department of Consumer Affairs Director Brian Stiger. “We are very pleased that, in partnership with the attorney general’s office, we have been able to stop a bad player from further harming both consumers and the hard-working, law-abiding players in the auto repair industry.”
As part of the settlement, the Midas International Corporation will acquire all of Glad’s 22 shops and retain the approximately 100 employees. In addition, the Midas corporation will honor all guarantees or warranties previously made or given to customers. The stores will continue their business operations without interruption.
Consumers who had filed provable claims with the California Bureau of Automotive Repairs received compensation from Glad prior to the settlement deal.
The state attorney general’s office filed the lawsuit in June 2009 after a four year undercover investigation by the California Bureau of Automotive Repair. The investigation revealed that Glad regularly advertised $79 to $99 brake specials at his Midas shops to draw in customers and then often charged another $110 to $130 for unnecessary brake-rotor resurfacing. In some cases, customers were charged hundreds of dollars more for repairs that were not needed or never performed.
In 1989, the state attorney general sued Glad for similar violations, which resulted in an injunction prohibiting his shops from performing unnecessary repairs, charging for services not performed, or using scare tactics to convince customers to purchase unnecessary parts and services. The California Bureau of Automotive Repair initiated its recent investigation into Glad's Midas shops to monitor compliance with the injunction.
Undercover agents, posing as customers, conducted approximately 30 sting operations at Glad's shops. In total, there were more than 35 incidents, involving 105 violations, in which shop managers, mechanics and employees made false or misleading statements to pressure customers into purchasing unnecessary parts and services. On average, the shops charged undercover agents almost $300 in unnecessary brake-rotor resurfacings, brake-drum repairs, brake adjustments, brake-cleaning services and other services.
“Overselling of services has become an increasing problem,” said California Bureau of Automotive Repair Chief Sherry Mehl. “It amounts to fraud and seriously harms the consumer. That’s why we aggressively work to find and shut down these shops.”
In accordance with the stipulated settlement, Glad did not have to admit to any liability.
To contact Sabra Stafford, e-mail or call 634-9141 ext. 2002.