Hundreds complain 'NeedTags' leads drivers to believe it's the DMV, adds surprise fees
SAN JOSE, Calif. (KGO) -- Dozens of California drivers are complaining they were tricked into clicking on a website they thought was the DMV -- when in fact it was a private company selling DMV services.
You might be surprised to learn the DMV authorizes companies to take your DMV payments -- and they can add as much as they want in extra fees.
So why let companies profit off drivers paying a DMV bill?
7 On Your Side has seen hundreds of complaints about one company in particular: NeedTags.com.
VIDEO: DMV lookalike 'NeedTags' threatens elderly customer with legal action for credit card dispute
Consumers say the website looks and functions like the DMV website -- but tacks on surprise fees.
One consumer advocate says the added fees could violate the state's ban on junk fees, and a South Bay consumer is trying to raise awareness.
"It has all the appearance of the DMV," said Allyn Peterson of San Jose.
Peterson went to the DMV website to renew his car registration.
Or so he thought.
"It's like, what is this?" he said.
His DMV registration fee was $231. So why was he charged $303?
"We feel we're being, if you will, ripped off," Peterson said.
MORE: DMV adds late fees and penalties after drivers register their cars with e-checks
It turns out he'd mistakenly clicked on a third-party website: NeedTags.com, which provides DMV services -- but tacks on extra fees at checkout.
When he realized his mistake, he called to cancel the order. He was shocked at the response.
"'If you dispute this transaction we will take legal action immediately,' which is not what I would expect from a reputable company," he said.
But what upset him more? Peterson found out NeedTags was not some rogue company, but a DMV partner. The DMV authorizes NeedTags and other vendors to sell DMV services and tack on as much as they want in extra fees.
"They can charge what they want, they're a private company. My problem is, why is our government enabling them? Why is it officially sanctioned by the government?" Peterson asked. "I don't understand the government doing this to their own citizens."
Consumer advocate Robert Herrell says the state should require companies like NeedTags to post prominent disclaimers.
"It ought to be clearer and much more conspicuous," Herrell said. "'You are not on the DMV website, if you want the DMV click here...' And you're gonna pay a heck of a lot more than had you done directly to the DMV website."
Scores of Californians posted complaints online and to 7 On Your Side, saying NeedTags led them to believe it's the DMV.
MORE: Paperwork roadblocks delay woman's DMV vehicle registration renewal for six years
For one, NeedTags pays Google to appear at the top of search results for the DMV.
Also, the NeedTags website says "California DMV registration renewal" in large type.
It's not until checkout that consumers see the extra fees tacked onto their bills.
"The Department of Motor Vehicles offers the same functions for nothing. Why is there a NeedTags?" Peterson asked.
NeedTags owner Eddy Asmerian could not be reached, but he has told us the company is "committed to transparency,'' and the website shows fees before payment.
We asked DMV director Steve Gordon about the surge of complaints about the DMV partner.
Gordon did not respond directly. But in emails to 7 on your side, a DMV spokesperson said the NeedTags website states it is not the DMV.
But where?
MORE: Driver stuck with fees when DMV sends him new sticker, then says they can't renew the registration
"There is some fine print there, but it's written in a font size that's considerably smaller than everything else on that page... the page is designed to draw your eye to the other elements, pictures of license plates... it violates every test of what we call 'clear and conspicuous' that you can imagine," Robert Herrell said.
As for hidden fees, the DMV said NeedTags does list them.
But even if they knew about fees, consumers would have to scroll to the bottom of the website and click a button.
It shows they will pay an extra $49 per car, or $100 for commercial plates, and an array of smaller charges on top of the DMV fee.
"I would argue that's a violation of California's upfront, anti-drip pricing law," Herrell said.
We asked the DMV: is NeedTags violating the state's own ban on hidden fees?
The DMV said to contact the Department of Justice.
"The optics are horrible here for the DMV to be saying, 'not our problem,'" said Herrell. "Now that you've brought this to our attention, the Consumer Federation of California will follow up. We'll follow up with the Attorney General's office."
The DMV tells 7 On Your Side these partnerships began back when the DMV had long lines and companies helped alleviate the burden. But now, the DMV website can process transactions quickly, without an in-person visit and it's free. In spite of its partnership, DMV urges motorists not to use NeedTags -- but go directly to the DMV website.
Take a look at more stories and videos by 7 On Your Side.
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