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This type of financing abuse was described in testimony submitted to the Federal Trade Commission in February by the Center for Responsible Lending, a nonprofit group, and several other consumer groups. The F.T.C. has held a series of public roundtables called ”The Road Ahead,” to gather information on auto financing practices.

In response, a group representing car dealers told the F.T.C. that abusive lending practices are not widespread.

In a spot sale, the center says, most customers believe the deal is final – or close to it. But in reality, the dealership has retained the right to renegotiate terms and even to take the car back if it decides it doesn’t like the deal or is unable to sell the loan to a bank or finance company under terms it deems acceptable.

This can result in what the center calls a ”yo-yo scam,” where the salesperson ”pulls the consumer back to the dealer, like a yo-yo on a string.” The buyer is typically told the financing ”fell through,” and is then pressured to sign a new contract with financing terms that are less favorable — like a higher interest rate or a larger required down payment.

The benefit of such arrangements for the dealer, said Christopher Kukla, the center’s senior counsel for government affairs, is that once consumers take the car home thinking the deal is done, they are not shopping around for better loan terms, or looking at other dealerships for a different car.

In some cases, he said, buyers who refuse to agree to the new terms have had difficulty getting their down payments or trade-ins returned to them — sometimes because their trade-ins may have already been sold. Consumers more likely to be targeted are those with low incomes or blemished credit, and they may only have one vehicle, so they often have little recourse, he said.

The advocacy groups have asked the F.T.C. to halt these sales as ”unfair and deceptive” practices, and to ban most spot deliveries because they give dealers an unfair upper hand in negotiations with consumers.

The National Automobile Dealers Association, meanwhile, argues that deceptive practices ”are not prevalent” in the marketplace and that a blanket ban on ”conditional sales,” or agreements made contingent upon financing, is unwarranted. ”It is the exception, not the rule, when abusive spot delivery practices occur,” the association said in remarks submitted to the F.T.C. in March.

The dealers association dismissed as ”completely anecdotal” the information presented by advocacy groups on how widespread abusive practices like yo-yo financing are.

This month, the Center for Responsible Lending published a report based on estimates from five groups that work with consumers on auto financing and legal issues — the National Consumer Law Center, the National Association for Consumer Advocates, the North American Consumer Protection Investigators, National Odometer and Title Fraud Enforcement Association and the United States Navy Judge Advocate General’s Corps. The groups together handled about 2,100 consumer complaints in the prior year, with about one-fourth involving yo-yo financing, they said.

In an e-mail, David Hyatt, a spokesman for the dealers association, said the practices claimed in the center’s report ”clearly should not be present in the marketplace.”

But, he said, it’s important to distinguish between fraudulent yo-yo financing and legitimate conditional sales or spot deliveries, because there are millions of auto sales transactions each month, almost all of which are conditional sales pending loan approval.

”This is not to minimize the seriousness of the allegations,” he said, ”but the latest C.R.L. report does highlight the fact that no credible evidence exists to suggest that the cases brought to their attention are representative of tens of millions of conditional deliveries that occur nationwide each year without any hint of problems for consumers.”

Have you ever encountered anything like a yo-yo deal when buying a car?

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Last month, I wrote about RelayRides, a company that helps you rent your car to strangers. It’s a big enough idea that the company has attracted investments from Google and General Motors.

You set and post the price on the company’s Web site, and the company handles the background checks on renters, the reservations and collecting the money. It, and similar peer-to-peer car-sharing companies, keep some of the money before handing over the rest to you.

Any prudent car owner would worry about the liability insuranceimplications here, and RelayRides provides $1 million of itto the owner of the car. The company does this because your own insurance company may not cover damage that occurs when you’re essentially running a business by renting out your car. Indeed, USAA and Allstate told me last month that they were troubled enough by the personal car-sharing movement that they might decline to renew policies if they found out that customers put their vehicles in a car-sharing pool.

In response, a RelayRides spokesman said in March that the company had been operating in Massachusetts, where the company began, “without any problems” related to people losing their insurance.

Here’s what RelayRides did not say, however, about a much bigger insurance problem it already had on its hands: a little more than a month before it sent me that statement, a RelayRides renter crashed into another carand died at the scene. The four young adults in the car that was hit were all injured badly enough (multiple facial fractures, no use of hands for weeks, injured hip) that their claims could exceed $1 million, putting the owner who had rented out her car at some financial risk.

So if you’re thinking of tossing your car keys to any random person who turns up on the Web, it’s worth learning a little more about the complicated case of that owner, a 24-year-old former Google systems administrator and a current M.I.T undergraduate (and still a part-time Googler) named Liz Fong-Jones. Her experience demonstrates that using the Web to share your car is nothing at all like sharing your vacation pictures or household tools, and that it may be wise to temper the collective lust for innovation by more carefully considering the need for protection in case something terrible happens.

THE OWNER Ms. Fong-Jones’s saga began in early February with a phone call from a RelayRides executive letting her know that her 2003 Honda Civic Hybrid had been in an accident in Boston and was damaged beyond repair.

She got a check to cover replacement costs and thought that was the end of it. “RelayRides was supposed to step in for any claims that happened,” she said.

Unfortunately, Patrick Fortuna, the man who had driven her vehicle, was dead and couldn’t tell the injured parties that he had rented the car (and had insurance) through RelayRides. So Ms. Fong-Jones eventually heard from her own insurance company, Commerce, which had heard about the accident from one of the plaintiffs’ lawyers who eventually became involved.

THE INJURIES Riding in a 2008 Honda early in the morning on Feb. 5 were Jessica Luisi, Veronica Hodges, Jenna Reilly and Kevan Knecht. According to a preliminary police report, their car was hit by an oncoming car that seemed to have been traveling south in their northbound lane. The report concluded that Mr. Fortuna would be found at fault.

Ms. Luisi had injuries to her right hip and left knee, among other areas of her body, according to an account that Mr. Knecht’s sister posted online, while Ms. Hodges had broken both wrists, one arm and one hand. Many of the bones in Mr. Knecht’s face had been broken, while Ms. Reilly needed stitches on her face and has suffered from concussion syndrome, according to her lawyer.

Besides seeking reimbursement for medical bills (Mr. Knecht’s alone are nearing $100,000, according to his lawyer, William Doyle Jr.), the injured people could also file pain-and-suffering suits. “If somebody crosses the center line and plows into your car, it does a number on you in terms of how you feel about getting into a car,” said Jonathan Karon, Ms. Hodges’s lawyer.

THE INSURANCE If there is any good news in this, it’s that there is a lot of insurance coverage. RelayRides has $1 million in coverage per incident (though not per person), while Ms. Fong-Jones has $300,000 in coverage.

Assuming that Mr. Fortuna was indeed at fault, the questions then revolve around how high the claims or legal judgments may go and which insurance company will pay. It is early to be estimating, though one of the lawyers for the victims has suggested that the claims may total somewhere around $1.2 million to $1.5 million.

Let’s assume that the lawyer is not exaggerating, and that the total amount exceeds RelayRides’ $1 million coverage. Who pays, and how much?

“RelayRides has encouraged my company to deny the claim,” Ms. Fong-Jones said. “They do not want to have insurance companies thinking that they have to insure against losses related to car-sharing. They have a long-term interest in making sure that people who are enrolled in RelayRides don’t have their personal insurance canceled.”

RelayRides rejects any suggestion that it is acting in a self-interested manner. “Our interest is in protecting Ms. Fong,” said Shelby Clark, RelayRides’s founder and chief community officer.

Ms. Fong-Jones’s own insurance company, Commerce, is now in a tough spot. “My insurance company thinks there is a conflict of interest in RelayRides telling them to drop the case,” she said. “Their viewpoint is that I need as much insurance as possible and that they are acting in my best interest by continuing to investigate and defend me personally.”

Dan Olohan, the general counsel for Commerce, declined to comment.

THE FUTURE So let’s say the claims for the four injured parties exceed $1 million and Commerce elects not to pay a cent. Would Ms. Fong-Jones have to pay any damages herself?

On one hand, she is certainly an inviting target. After all, she has worked full-time at Google and is now finishing her degree at M.I.T. She probably has many millions of dollars of income ahead of her that a lawyer could try to garnish.

Then again, what did she do wrong? She wasn’t driving the car, and it wasn’t her employee driving the car. Would a lawyer or jury punish her simply for allowing someone else to drive it?

“Would it get looked at? You have to look at it,” said Mr. Doyle, who represents Mr. Knecht, the young man with the broken facial bones. “It’s a risk Ms. Jones probably did not appreciate when she signed up for RelayRides.”

RelayRides’s corporate investors, General Motors and Google, could just write a check to Ms. Fong-Jones to make her whole. Neither company wanted to comment on the episode, though.

As for RelayRides itself, it seems to want to do the right thing. Not long after the accident, when Ms. Fong-Jones posted on Google Plus about the crash, Mr. Clark of RelayRides put up a message there, too: “We 100% commit to making sure that everyone involved in this tragedy is taken care of as well as humanly possible.”

When I asked the company whether this meant cutting a check to Ms. Fong-Jones if she ended up personally liable, Alex Benn, a lawyer who oversees insurance for the company, had this to say: “What happens in any sort of accident with insufficient coverage? That’s the societal burden of torts that have liability where there is no insurance coverage.”

So much for the sharing ethos. When I pressed further on this point, Mr. Benn declined to speculate further. RelayRides said Thursday that it had hired a lawyer for Ms. Fong-Jones. Curiously, when I asked her about this on Friday morning, she had no idea that she had a lawyer and said that no lawyer had been in touch with her. It turns out that this lawyer also represents RelayRides, which hardly seems as if it is in Ms. Fong-Jones’s best interests.

In any event, she has done her own legal homework and points to a federal law that can shield rental car companies from liability for accidents that happen while someone is renting the car. It is not clear, however, whether the law covers people who rent out their cars for $10 an hour.

Meanwhile, the company has no current plans to raise its insurance cap beyond $1 million. “Do we feel that our current coverage is inadequate? Absolutely not,” Mr. Clark said.

THE CODA Despite ending up with a dead body behind the wheel of her last car, Ms. Fong-Jones put her replacement vehicle right back into the RelayRides rental pool.

Why would she do this? “The original reason I signed up is still very much true,” she said. “I don’t drive the car very often and am environmentally minded and want other people to use the car rather than buying cars of their own.” She also has a dog and feels for other dog owners who can’t find dog-friendly rental car companies.

Commerce may well put a stop to her car-sharing, and other insurance companies could explicitly warn their own customers away from this, too — as both USAA and Allstate did last month in my column. Other insurers might allow it but charge the kind of premiums for the privilege that would scare off most people.

Given all of this, Ms. Fong-Jones may want to share her car as much as she can, since she may not be able to much longer. As for anyone else who is considering renting out a vehicle, they’ll have to weigh their principles against the possibility, however remote, that they could end up in a situation just like this.

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