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Missouri Mobile Home Dealer Hit With $564,000 Penalty

April 13, 2006
One of central Missouri's largest mobile home dealerships will pay more than $564,000 in consumer restitution and penalties to the state under a consent judgment and permanent injunction obtained by Missouri Attorney General Jay Nixon.

The injunction resolves a lawsuit Nixon filed in Boone County Circuit Court in March 2004 against Ashland-based Amega Sales and Amega president Greg DeLine alleging that they improperly kept customers' down payments, misrepresented the consumers' ability to obtain financing, and made false promises about the features of the mobile homes and the setup services Amega would provide.

"This order resolves long-standing problems with Amega," Nixon said. "Not only will the defendants have to pay significant consumer restitution, they also are prohibited from further violations of Missouri consumer protection laws. They also must meet with staff from my consumer protection division over the next five years on a regular basis to review and resolve new complaints."

Amega Sales does business under the names Amega Mobile Home Sales, Columbia Discount Homes, Quality Pre-Owned Homes and Mark Twain Mobile Homes. DeLine also has three other businesses, DeLine Finance LLC, A&G Commerical Trucking and Service Pro Inc., which are covered by the permanent injunction.

Under the order signed by Circuit Judge Gary Oxenhandler, the defendants must:

• Immediately pay $264,127 to the state for restitution to 70 consumers whose individual losses between $25 and $64,713 have been ascertained, and also pay $150,000 for restitution to consumers who have been identified but whose losses have not been determined;

• Pay $100,000 to the Missouri Merchandising Practices Revolving Fund to cover the costs of investigating and prosecuting the lawsuit, and pay another $50,000 in civil penalties;

• Not violate any provision of Missouri's Manufactured Homes Act nor engage in any conduct of deception, fraud or misrepresentation that would violate the Missouri Merchandising Practices Act; and

• Meet on a quarterly basis over the next five years with representatives of the Attorney General's Office to review and resolve any new complaints against the defendants.

Nixon said many of the complaints concerned financing of the homes. Amega would agree to arrange financing for consumers to buy mobile homes, and often the consumers had no other credit or finance options, Nixon said.

After being required to make a substantial down payment before the financing terms were disclosed, the consumer would find out the terms offered by the defendants were unreasonable, and so the consumer would refuse to accept them. Amega would pocket the down payment, and the consumer was left with no mobile home and would be as much as $2,500 poorer, Nixon said.

Nixon says other complaints against the defendants alleged that they would:

• Falsely tell consumers verbally or in writing that consumers' down payments would be returned if acceptable financing could not be arranged;

• Falsely tell consumers they were pre-approved or guaranteed to receive financing, as an inducement for consumers to purchase a mobile home or make a substantial down payment;

• Make misrepresentations to consumers about the amount of their monthly payments to induce them to make purchases;

• Take consumers' old mobile homes as a trade-in to be credited toward the purchase of the new home and requiring consumers to give the defendants the deed of trust to consumers' land as a "formality" until the old home was collected. The lawsuit stated the defendants then would refuse to return the deed of trust and keep the property;

• Require consumers to purchase insurance from the defendants as a condition of purchasing a mobile home;

• Make misrepresentations about the features of the mobile homes, such as appliances, furnaces, air conditioning units, windows, doors, carpet and paint;

• Make false promises about the setup services the defendants would provide home owners, including delivery, blocking, leveling, supporting and assembling the mobile home and finishing the exterior and interior of the home; and

• Fail to do promised post-setup services, such as installing furnaces and air conditioners and seaming carpets, or do the work in a shoddy manner.

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