Hertz announced today that it has agreed to settle 364 pending claims relating to its alleged issuing of false theft reports against its customers. The company will pay $168 million by the end of the year to resolve these disputes.
The rental agency says that the agreement will settle about 95 percent of its pending theft report claims, which saw customers arrested, jailed, and, in one case, held at gunpoint by police officers who believed that a vehicle that had been legally rented was stolen.
“As I have said since joining Hertz earlier this year, my intention is to lead a company that puts the customer first,” said Stephen Scherr, Hertz’s CEO. “In resolving these claims, we are holding ourselves to that objective.”
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The company has been accused by numerous of customers of filing false theft reports that negatively impacts on their lives. As recently as October, Hertz was sued by a customer for falsely flagging a car as being stolen.
In that case, Nicholas Wright was in a rented car with his 13-year-old daughter in 2021. Just 30 minutes after picking the car up from the rental agency (in this case, Hertz’s subsidiary, Thrifty), he was stopped by police.
Wright reports being surrounded by police officers with guns drawn, and said he feared for the lives of both he and his daughter. The situation was only resolved when a Thrifty manager arrived at the scene to clear things up. Wright was told by police, though, that “this happens all the time with Hertz.”
Indeed, in April, Hertz disclosed that it issues hundreds of erroneous theft reports per year. Lawyers for customers who were suing the company said, though, that the number was more like 8,000 false theft reports per year. The company has been accused of using the police as a repo service by a whistleblower. After joining the Hertz early this year, though, Shcerr vowed to lead a charge against the practice.
“While we will not always be perfect, the professionals at Hertz will continue to work every day to provide best-in-class service to the tens of millions of people we serve each year,” said Shcerr.