Carvana Banned From Doing Business for 6 Months in 1 Market

RALEIGH, N.C.–North Carolina has suspended online used-car retailer Carvana Co. from selling cars in the Raleigh market until January of 2022 after a state investigation determined the company failed to deliver titles to the motor vehicle department and sold cars without state inspections.

A number of credit unions nationally have created relationships with Carvana to expand their auto lending.

According to the North Carolina Attorney General’s office, the state’s motor vehicles department, it has revoked Carvana’s dealer license for its Wake County, N.C. location until Jan. 29, 2022.

Tempe, Ariz.-based Carvana also has agreed to pay a civil penalty of $500 and an administrative hearing fee of $200, according to court documents.

The penalty was part of an agreement Carvana reached earlier this month with state officials, following a probe by the North Carolina’s Division of Motor Vehicles, the Wall Street Journal reported.

“We’re pleased that we were able to reach a solution with the North Carolina DMV,” Carvana spokesperson Amy O’Hara said in a statement. “We’re proud of the tens of thousands of North Carolina residents we’ve served since 2014 and are excited to continue delivering exceptional customer experiences there for many years to come.”

Carvana sells cars exclusively online and has a market valuation of $64 billion, higher than that of Ford Motor Co., the Journal said.

Consumer Complaints

State officials in North Carolina said the motor vehicles department brought the enforcement action after receiving a consumer complaint and conducting an investigation.

The state said in court filings that Carvana violated dealer licensing laws by not delivering the vehicle title to the DMV in a timely manner and failing to perform a state-required inspection before the vehicle was sold in North Carolina, according to the Journal.

The Journal further reported state officials also said the company issued out-of-state plates and tags to a vehicle sold to a North Carolina resident, also a violation of dealer licensing laws.

North Carolina said the action is limited to the specific Raleigh-area location, not the three other sites that the company has in the state.

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