Carvana's dealer license suspended in Illinois, for now

Carvana Co. is under scrutiny once more, this time in Illinois, where state officials last week suspended the online used-vehicle retailer's license to sell cars and trucks.

Illinois Secretary of State Police temporarily blocked Carvana's dealer license on May 10 because the company failed to properly transfer titles for vehicles it sold and misused issuing out-of-state temporary registration permits, said Henry Haupt, an Illinois Secretary of State spokesman.

The Secretary of State's police department opened an investigation into consumer complaints about Carvana in February, Haupt told Automotive News. The investigation spans about 90 signed complaints, Haupt said. He said he couldn't provide an exact date as to when Carvana might see the suspension lifted.

Carvana will need to "resolve the issues at hand" before that can happen, Haupt said.

A Carvana spokeswoman did not immediately respond to a request for comment.

"Carvana has compliantly operated as a licensed dealer and good corporate citizen in the State of Illinois for several years, and we strongly disagree with the State’s characterization of both the facts and the law leading to this action," a Carvana spokesperson said in a statement. "We are actively working with the State to resolve this issue, and they have agreed that we will continue delivering already purchased vehicles. We look forward to resolving this issue with minimal disruption to customers."

Financial magazine Barron's broke news of the suspension on Friday.

The company has faced similar scrutiny in other states over titling and registration issues. In February, the online retailer averted a suspension of its dealer license in Florida after it processed outstanding vehicle title applications before a key Jan. 31 deadline.

The company's license to sell in North Carolina was blocked last August for 180 days over similar vehicle titling and tag issues. It was restored this year.

Carvana has one of its vehicle vending machines in Illinois, in Oak Brook, a Chicago suburb.

Carvana shares ended Monday up 0.23 percent to $38.40.