7 On Your Side reporting on DMV look-alike website 'NeedTags' prompts new CA legislation

SAN FRANCISCO (KGO) -- Legislation protecting California drivers from exorbitant fees by third-party vendors for renewing their vehicles' registration is advancing to an Assembly floor vote thanks to 7 On Your Side reporting.

Last year, ABC7 News uncovered DMV look-alike websites, including NeedTags, that charge drivers a premium for offering the same services as the DMV.

There was an overwhelming majority in the State Assembly Transportation Committee this week for AB 1190, introduced by Assemblymember Matt Haney.

"AB 1190 is about making sure all Californians can access basic DMV services at a fair price," said Haney, who represents California's District 17.

The problem? Many Californians have been inadvertently googling their way to third-party sites, like NeedTags, thinking they're on the DMV website.

"Many of these websites are literally spoofing the DMV website: same color, same scheme, same font," said Robert Herrell, executive director of the Consumer Federation of California.

RELATED: Angry CA drivers say DMV lookalike website 'NeedTags' tricks them to paying extra fees

Drivers see a different price tag. Allyn Peterson said he paid an extra $72.

"Charging 37% premium to register my car is not fair," Peterson said.

Even worse, Peterson said the company threatened him if he stopped payment.

"'An improper chargeback will be prosecuted to the fullest extent of the law,'" Peterson said.

Locke Heemstra also paid extra.

"They made it look like it was real official," Heemstra said.

RELATED: DMV lookalike 'NeedTags' threatens elderly customer with legal action for credit card dispute

"That's a predatory practice in my view. It's tricking California drivers, over 30 million of them," Haney said.

Peterson contacted lawmakers and 7 On Your Side last year. He didn't hear back from lawmakers, but he did hear back from 7 On Your Side. Our report caught lawmakers' attention.

"The report that ABC7 did is really what brought this to light, and we decided we needed to take action," Haney said.

AB 1190 caps fees at no more than 5% above what the DMV charges for the same service. It also requires the websites to prominently display a link to the official DMV website and disclose that DMV services can be accessed directly with no additional cost.

"I think you owe the citizens of the state protection from need tags and their own DMV," Peterson said.

"From my point of view, NeedTags has been cheating people for 10 years. What this bill does is reduce the amount that they can cheat on. It's an improvement. That's why if you will, I'll support this, but it's not the perfect solution from my point of view. This should be ended," Peterson said.

NeedTags has not yet responded to our request for comment. The DMV told 7 On Your Side that the department does not comment on pending legislation.

"You know, you have something wrong when you have people saying they would rather work with the DMV than these other people. So you have my aye vote," said Assemblymember Corey A. Jackson, District 60.

The bill now goes to the Assembly floor for a vote.

Assemblymember Tom Lackey did not vote on the bill.

His office shared the following statement: "I did not support the bill because it seems to go beyond the author's original intent of cracking down on bad actors, and ends up pulling in legitimate businesses without clear guidance on how the mandate would work. That kind of uncertainty could lead to confusion, lawsuits, and unintended impacts on consumers. That said, I do think the bill is fixable, and I encourage the author to tighten up the language and better target the bad actors."

Take a look at more stories and videos by 7 On Your Side.

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