The latest trend in the used car business: Buy a car, get a GPS, too.
The twist is you may never know about it.
Car dealers — especially the ones who cater to customers with bad credit — increasingly are placing GPS devices on the cars they sell.
These devices aren't the kind you mount on the dashboard to navigate city streets. They're electronic locators, designed to help the repo man find your car if you stop paying. Some devices can even render the car inoperable until you pay up.
In the cat-and-mouse game between the late-paying car customer and the buy-here, pay-here dealer, the GPS locator is a new weapon.
The trouble comes when it's kept secret.
"They don't want the customer to know that if they don't pay, they can come find it," said Duane Overholt, an industry critic who runs the website stopautofraud.com.
Bond Auto Sales at 5755 34th St. N in St. Petersburg has been accused in three recent lawsuits of placing GPS devices on cars without telling buyers.
When customers successfully paid off their loans, they were invited back for a free "safety check," the lawsuits say. Then, employees would remove the secret devices.
All three plaintiffs, two former employees and a customer, are represented by Douglas Lyons, a Tallahassee lawyer. He said he had never heard of the practice until these cases. But, after researching it, he found that it's not that uncommon.
In 2011, the Florida Attorney General filed suit against a Jacksonville dealer over similar allegations. That case is still in court.
Car repossessions guided by GPS are so widespread the industry has its own trade group: The Payment Assurance Technology Association.
The group has a code of ethics that requires its members to "fully define and disclose" the devices to customers.
One of them, Dave Ronsky, CEO of Ohio-based Payteck, said it doesn't even make sense to place the devices secretly.
"It's just good business to let the customer know that the dealer has the ability to either disable the starter of the vehicle or locate the vehicle," he said.
That way, customers know their payment isn't optional. "That's a more effective behavior modification tool," he said.
He requires dealers he works with to sign agreements promising to disclose the devices.
Ronsky, like several others interviewed, said the devices are used in the "sub-prime" auto market. They're not going into Cadillacs or BMWs sold to people with good credit.
"It's the deep sub-prime, buy-here pay-here, consumers with poor credit scores," said Chris Macheca, CEO of Colorado-based Passtime.
His devices not only serve as locators, but also as reminders. If a payment is due, the device beeps for 20 seconds — kind of like a seat belt reminder — after starting the car.
A customer with a low credit score often is happy to buy a car with a GPS locator installed, and to sign a contract that discloses the device. Without it, he or she might not be able to buy a car at all.
Even Lyons, the attorney suing Bond Auto Sales, doesn't see a problem with that.
"I suppose if they make that kind of disclosure, we really wouldn't have a beef," he said.
Ricky Hicks, the general manager of Bond Auto Sales, would not comment on the devices or the lawsuits.
"We're trying to settle it," he said. "It was a miscommunication."
Michael Fischer, who owns GPSandTRACK in Phoenix, said the decision of whether to disclose the devices should be left to dealers.
They aren't being used to spy on customers, he said, they're a way of getting cars back if people don't pay.
"The dealers could care less what their customers are doing all day," he said.
Jon Mills, professor and dean emeritus of the University of Florida's Levin College of Law, said secretly placing devices raises "a lot of red flags."
He called it "an intrusion upon seclusion." The practice reminds him of the controversy that arose after several large rental companies were caught secretly placing spyware on computers they rented out.
"Essentially what they're trying to do there is stalk the person," said Timothy Kaye, a law professor at Stetson University. "And you don't have a right to stalk anyone."
Staff Writer Curtis Krueger can be reached at [email protected] or (727) 893-8232. Twitter: @ckruegertimes.