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Hertz to pay $168M after falsely accusing customers of stealing rental cars

Dozens of customers had shared stories on social media and broadcast television programs of being arrested, ‘’swatted’' or stopped at border crossings after Hertz had incorrectly reported them to the authorities for stealing vehicles from its rental fleet.David Paul Morris/Bloomberg

Hertz said Monday it will pay $168 million to settle hundreds of claims by customers who were falsely reported by the rental car company as having stolen its vehicles, with some innocent renters arrested and jailed for weeks or months over the reports.

Hertz said in a brief statement that it was settling 364 claims, which it said amounted to 95 percent of the outstanding claims against the company over the false theft reports.

Dozens of customers had shared stories on social media and broadcast television programs of being arrested, ‘’swatted’' or stopped at border crossings after Hertz had incorrectly reported them to the authorities for stealing vehicles from its rental fleet.

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In many of the cases, the customer had paid for and properly returned the car weeks or months prior — or had never rented a car at all.

Drew Seaser, a real estate appraiser in Colorado, learned of a warrant for his arrest in Georgia when he was stopped at the airport on the way to Mexico with his family. Seaser told CBS News that he had never been to Georgia nor rented a car from Hertz. He was jailed for more than 24 hours; the charges were dismissed after his lawyer provided prosecutors with an alibi.

Paul-Anthony Knight said on ‘’Inside Edition’' that he was arrested after Hertz incorrectly filed a theft report against him. ‘’All guns drawn on me. I was thrown to the ground. I was arrested. And I was locked up for over a week,’’ he said. Another man, Julius Burnside, told the program that he was jailed for more than six months over an erroneous report.

It was not immediately clear whether Seaser, Knight and Burnside were among the claimants who settled with Hertz, which emerged from bankruptcy in 2021. An attorney for dozens of customers who sued Hertz in Delaware did not immediately respond to a request for comment.

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Hertz said in February that ‘’the vast majority of these cases involve renters who were many weeks or even months overdue returning vehicles and who stopped communicating with us well beyond the scheduled due date.’’

But Hertz chief executive Stephen M. Scherr was more apologetic, saying in April on CNBC’s ‘’Squawk Box’' that ‘’it’s not acceptable to Hertz to have any customer, a single customer sort of caught up in some of what’s happened.’’ He said the issue of false theft reports was ‘’among the first things’' he dealt with since taking the helm of the company in February. ‘’Several hundred people’' were impacted by the reports, he said.

Erroneous reports were withdrawn when they were discovered, Scherr said, ‘’yet these people got caught, you know, in a moment’' when the rescinding of the reports ‘’wasn’t recognized’' by law enforcement. The false reports were ‘’unfortunate,’’ he said.