Hertz, one of the largest car rental companies in the world, agreed to pay $168 million to settle claims from hundreds of customers who were falsely accused of stealing rental cars they had already returned. The settlement, announced in December 2022, resolved claims from 364 people — many of whom were arrested, jailed, and charged with felonies based on erroneous police reports filed by the company itself.
See full details on the Hertz false theft accusations settlement here.
Status: Settled — $168 Million
What Did Hertz Do?
For years, Hertz repeatedly filed false stolen vehicle reports with police departments across the country against its own customers. The problem was not a single mistake — it was a pattern rooted in broken internal systems and a failure to correct errors even after they were discovered.
The false reports happened in several ways:
- Rental extensions that never registered. Customers called Hertz to extend their rental agreements, but the extensions were never properly recorded in the company’s computer system. The vehicles were then flagged as overdue and reported stolen — even though the customer had permission to keep the car.
- Returned cars still flagged as stolen. In some cases, customers physically returned vehicles to Hertz locations, but the company never withdrew the theft reports it had already filed with police. Those customers later found themselves facing arrest warrants for cars sitting in Hertz’s own lots.
- Credit card processing errors. When a customer’s credit card declined or had a temporary hold, Hertz would reprocess the charge. Even when the second attempt succeeded, the company still reported the vehicle stolen without updating law enforcement.
- Wrong customer linked to wrong car. Hertz’s system sometimes attached stolen vehicle flags to the wrong customer accounts entirely, resulting in arrest warrants for people who had nothing to do with the vehicle in question.
What Happened to the Customers?
The consequences for Hertz customers were devastating and, in many cases, life-altering. People who had done nothing wrong — who had returned their cars on time, extended their rentals properly, or paid in full — found themselves treated as criminals.
- Customers were pulled over by police and held at gunpoint while driving cars that Hertz had reported stolen
- Some were arrested in front of their families, handcuffed, and taken to jail
- One customer spent more than 30 days in jail before the error was discovered
- A man in Mississippi was imprisoned for over six months after returning his rental car and paying his bill in full — Hertz simply never told prosecutors the car had been returned
- Customers lost jobs, suffered damaged credit, and faced lasting emotional trauma from being wrongly branded as car thieves
Attorneys involved in the cases noted that false accusations disproportionately affected Black customers and other minorities, compounding the harm with the added weight of racial profiling during traffic stops and arrests.
The $168 Million Settlement
Hertz agreed to pay $168 million to resolve the claims of 364 individuals, representing more than 95 percent of all pending false theft accusation cases against the company. The settlement was announced in December 2022.
While the company did not publicly break down individual payment amounts, simple math puts the average at roughly $461,000 per person. In practice, payouts almost certainly varied based on the severity of each person’s experience — how long they were jailed, whether they lost employment, and the extent of documented damages.
The lead attorney representing over 230 of the claimants was Francis Alexander Malofiy, who had initially sought $530 million on behalf of his clients. The law firm Bailey Glasser also represented a significant number of victims.
How Did This Go On for So Long?
One of the most troubling aspects of the Hertz scandal is how long it persisted. Former employees and internal documents revealed that the company was aware of problems with its vehicle tracking and reporting systems but failed to implement adequate safeguards. Filing a police report is a serious legal act — it sets in motion an investigation that can result in warrants, arrests, and criminal charges. Hertz treated it as a routine collections tool.
The company’s bankruptcy filing in May 2020 complicated the legal landscape. Many victims worried their claims would be wiped out in bankruptcy proceedings. However, a bankruptcy judge ruled that 89 cases could proceed in their respective state courts, allowing victims to continue pursuing justice even as Hertz restructured.
What Should You Do If This Happened to You?
While the major settlement has resolved the bulk of pending claims, if you were falsely accused of vehicle theft by Hertz and have not yet taken legal action, you may still have options:
- Gather all documentation — rental agreements, receipts, credit card statements, police reports, arrest records, and any correspondence with Hertz
- Check your criminal record — false theft charges may still appear on background checks even if they were eventually dropped, which can affect employment and housing
- Consult with an attorney — a lawyer experienced in consumer rights or wrongful arrest cases can evaluate whether you have grounds for an individual claim
- Request expungement — if you were charged based on a false Hertz report, you may be able to have the arrest and charges removed from your record
Read the full breakdown of the Hertz false theft accusations settlement on our dedicated page.
Case Details
| Defendant | Hertz Global Holdings / The Hertz Corporation |
| Allegation | Filing false stolen vehicle police reports against customers |
| Settlement Amount | $168 million |
| People Covered | 364 claimants (95%+ of pending cases) |
| Key Case | Benson v. The Hertz Corporation et al. (Case No. 2:23-cv-00992) |
| Court | U.S. District Court, Middle District of Florida |
| Status | Settled (December 2022) |
By Steve Levine | Published: February 18, 2026
Legal Disclaimer
This article is for informational purposes only and does not constitute legal advice. If you believe you were falsely accused of vehicle theft by a rental car company, consult with a qualified attorney to understand your options. OpenClassActions.org is a consumer news site and is not a law firm.