Two car dealerships in Mount Kisco are refunding more than $1 million to New York drivers after state investigators found they tacked an illegal 2 percent commission onto vehicle sales that provided customers no actual service or benefit. New York Attorney General Letitia James announced the settlement, writing that her office “secured over $1 million in refunds for New Yorkers who were illegally charged junk fees by two Westchester car dealerships.”
The settlement targets DARCARS of Railroad Avenue, Inc., which operates as DARCARS Lexus, and MT Kisco Automotive, LLC, which operates as DARCARS BMW, according to NY AG James
. Under the agreement, DARCARS Lexus will pay $892,671.26 to reimburse buyers who were charged the improper commission between October 23, 2021, and May 30, 2022, while both dealerships will pay an additional $281,847.72 in combined restitution, per the
New York Attorney General's office
. Investigators determined the 2 percent fee gave consumers nothing in return, according to the same release.
Just how far the fee reached is striking. State investigative findings reported by Daily Voice show DARCARS Lexus collected roughly $5.8 million in commission fees from October 2021 to March 2025, while DARCARS BMW collected about $2.9 million between August 2022 and March 2025. The fee was applied to more than 96 percent of vehicle transactions across the two dealerships, the outlet reported, and the dealerships did not admit or deny the attorney general's findings.
A Costly Add-On Sold as Mandatory
The state investigation also found the dealerships pushed an expensive add-on package called DARCARS Assurance by falsely presenting it as a mandatory requirement, the attorney general's office said. The package included a $2,500 collision credit that customers could use only if they bought or leased another vehicle from the same dealership within 60 days of an insurance payout, according to state investigators.
Consumers who were charged the 2 percent sales commission after May 2022 are still eligible for restitution through a state-administered claims process. Officials expect that process could push total refunds into the millions of dollars, since the settlement's guaranteed payout so far covers only part of the roughly $8.7 million in disputed fees the two dealerships collected between 2021 and 2025. Because those later customers must file claims to recover money, the final total will depend heavily on how many of them come forward.
New York's Fee Caps and a Pattern of Enforcement
New York State regulations cap dealership documentation and administrative fees at a maximum of $175, strictly limiting what dealers can charge beyond official DMV title, registration, and inspection fees, according to Bay Ridge Honda. That cap is part of why separate percentage-based fees and bundled add-on packages, like the ones found in Mount Kisco, have become prime targets for state enforcement.
The Mount Kisco case fits into a broader pattern from the attorney general's office. In May 2025, James secured more than $3.2 million from eight Nissan dealerships across New York City, Long Island, and the Hudson Valley after investigators found more than 1,700 lease-end customers had been overcharged with illegal buyout fees, as Hoodline previously reported. Then in June 2026, state regulators reached a separate agreement with Nissan Motor Acceptance Company that produced more than $4.5 million in refunds for over 3,100 New York drivers hit with junk fees on lease buyouts.
Locally, Westchester County lawmakers have moved in the same direction. In June 2025, the Westchester County Board of Legislators enacted consumer protection legislation aimed specifically at hidden junk fees, deceptive sales tactics, and abusive business practices across local retail sectors. Auto sales, financing, and repair disputes remain one of the most common consumer complaints statewide, ranking third in New York with 3,761 complaints filed to the attorney general's office in 2024, trailing only retail sales and tenant disputes.
