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Saturday 10 December 2016
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Feds Investigate Fiat Chrysler Sales Reporting

Feds Investigate Fiat Chrysler Sales Reporting

Federal authorities are investigating Fiat Chrysler Automobiles after accusations by at least two dealers that the company conspired to inflate sales.

The Justice Department and Securities and Exchange Commission are conducting investigations into the company’s sales practices, the automaker confirmed.

The probes center on “the reporting of vehicle unit sales to end customers in the U.S.,” Fiat Chrysler said in a statement. The company pledged to “cooperate fully with these investigations.”

Spokespeople for the Justice Department and the SEC declined to comment.

The investigations come six months after two Fiat Chrysler dealerships filed a civil racketeering lawsuit in January accusing the company of paying certain dealers to report false sales to “create the appearance that FCA’s performance is better than, in reality, it actually is.”

At the time, Fiat Chrysler dismissed the claims as “without merit” and said the suit came amid discussions with the dealer group over “the need to meet its obligations under some of its dealer agreements.”

The dealers that filed the lawsuit — Napleton’s Arlington Heights Chrysler Dodge Jeep Ram in Arlington Heights, Ill., and Napleton’s Northlake Chrysler Dodge Jeep Ram in Lake Park, Fla. — are part of the Napleton Automotive Group, one of the largest Fiat Chrysler dealer groups in the U.S.

In a statement, Fiat Chrysler said it “records revenues based on shipments to dealers and customers and not on reported vehicle unit sales to end customers.”

The federal probes could undermine the legitimacy of the company’s seemingly improbable U.S. sales record. The automaker has recorded year-over-year monthly sales gains for 75 straight months, a streak that has been helped by an automotive industry that has been recovering for six years but is still viewed as a major achievement for the automaker.

Photo Credit: FCA