Carvana admits wrongdoing; agrees to consumer safeguards and to conform to Illinois law

Illinois Secretary of State Alexi Giannoulias announced a settlement agreement on Jan 24th, with online used-car retailer Carvana, which admitted to violating Illinois law and agreed to abide by new restrictions aimed at protecting consumers. Illinois was the first state in the nation to suspend Carvana’s license in May 2022.

“The admission by Carvana demonstrates what we knew all along: that Carvana was violating the law in a manner that was harmful to Illinois consumers,” Giannoulias said. “Under my administration, I will do everything to ensure that proper safeguards are in place that protect Illinois consumers regardless of how they purchase a vehicle.”

Click here to watch a video statement from Secretary Giannoulias.

Illinois began investigating Carvana’s practices in February 2022 after customers alleged it was issuing out-of-state temporary registration permits and for failing to transfer titles in a timely manner as required by the state’s vehicle code.

The agreement also calls for Carvana to: adhere to Illinois law in the future; surrender its $250,000 bond; and allow for pre- and post-licensing Secretary of State Police inspections to ensure it remains in compliance. Most important, the settlement agreement allows the Illinois Secretary of State to summarily suspend and revoke Carvana’s dealership license once again if it fails to comply with either the agreement or the laws.

Secretary Giannoulias emphasized that Carvana’s actions of putting unregistered license plates on vehicles jeopardized Illinois consumers who were at risk of being ticketed by law enforcement for driving without proper title and registration.

Prior to the settlement agreement, Carvana was allowed to sell cars, but only under strict guidelines set forth by a Temporary Restraining Order (TRO) granted by a DuPage County judge. Under these guidelines, Carvana was not allowed to issue temporary registration permits or license plates, but was required to register titles through Illinois remitters, which are third-party entities licensed in Illinois to process title transactions. This ensured titles would be processed expeditiously.

Secretary Giannoulias, who applauded the efforts of the Secretary of State Police, emphasized that if customers have issues with their title and registration with a vehicle they purchased, they should contact the Illinois Secretary of State Police at 630-693-0551 to file a complaint. The Secretary of State Police will take action to get the title transferred.