Carvana license suspended again in Illinois

Carvana is again prohibited from selling used cars in Illinois after the Secretary of State Police reinstated a temporary suspension.

The state says the online seller has been issuing car buyers temporary registration permits from outside Illinois, not using a licensed third-party to transfer titles and not processing the registration paperwork through the Secretary of State’s office.

Illinois suspended Carvana’s dealer license May 10 after customer complaints. The Secretary of State issued a stay May 26, allowing the company to resume sales.

Carvana didn't immediately respond to a request for comment.

The state says it suspended sales again because Carvana was not transferring titles within 20 days of sale nor issuing Illinois temporary registrations to Illinois buyers. It also says Carvana would issue temporary registrations up to four to five times from different states for the same vehicle.

Carvana 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 a North Carolina county was blocked last August for 180 days over similar vehicle titling and tag issues. It was restored this year.

Carvana and other online car sellers are under pressure to cut costs amid higher interest rates and waning demand.  The company went public five years ago. Its stock has plummeted from a high of $370 last August to $22.25. In May, Carvana said it would lay off about 2,500 employees, or 12 percent of its work force.