Well-meaning dealers who violate a regulation are held just as liable as ethically challenged dealers who intend to bend the rules. Hundreds of thousands - perhaps even millions - of dollars are at stake. If you haven't reviewed or refreshed your compliance training methods or policies in a while, there's no time like the present.
Rules, Rules, and More Rules
If a federal agent walked through your dealership in the morning before the showroom opened, how many privacy violations could they find in plain sight? A pile of papers on somebody's desk could represent thousands of dollars in fines.
Regulators have always and will always target the car business. Loose processes could be exposing your dealership to a great deal of liability. The worst part is that your personnel may not even be aware they are committing a violation.
There's no end to the list of federal rules and regulations you need to be on top of as a dealer. The Gramm-Leach-Bliley Act. The FTC Privacy Rule. The FTC Safeguards Rule. The Telemarketing Sales Rule. Do Not Call Rules. Truth in Lending. Regulation Z. Regulation M. The Fair Credit Reporting Act. The Equal Credit Opportunity Act. The Used Car Rule. The Cash Reporting Rule. The USA Patriot Act. Unfair or Deceptive Acts or Practices. The Red Flags Rule.
You get the point.
In this business, nothing will do except for being absolutely upright and transparent. In today's landscape, the use of best practices should always be your top priority. You don't want to be the dealership that makes the news for having a huge class-action lawsuit filed against it.
However, knowing the ins and outs of these regulations isn't intuitive. It requires studying, reviewing and constant effort. With so much at stake, it might be time to evaluate your training methods and compliance policies.
Regulations govern every facet and aspect of dealership operations. The majority of dealerships operate above board and play fair, but there are so many laws and acts that are constantly changing, you can never do enough to stay on top of things.
Here are a few ways you can improve your training methods and compliance policies:
- Get Your People Certified
After advertising violations, the second thing that dealerships are sued over the most are finance infractions. Getting your F&I personnel and sales managers certified by the AFIP is the best way to make sure that your F&I operations are above board. AFIP testing covers all of the legal and ethical compliance issues in the field.
- Weekly Meetings
Rules, laws, acts, regulations, whatever you call them, they will be dense, tedious, and often full of incomprehensible legalese. Instead of shoving everybody in a room to watch three or more straight hours of videos, why not hold short, 30-minute meetings once every week or so. Doing your training in short spurts could help improve attentiveness and comprehension.
- Online Quizzes
Another idea is to use online quizzes as part of your training. Surely your workforce would appreciate being given the option to complete their training on their own time - even from at home. But to make sure that they are comprehending the regulations, you could install online quizzes that they need to pass in order to move on to the next section.
Whatever your dealership decides to do, there's one combination that can never be taken out of training and compliance policies: Time and effort. If you put in those, you can avoid violations and the disastrous penalties that come with them.
Here to Help
You know what's a great way to help avoid discrimination in lending or UDAP lawsuits? A dealer software solution that helps you quickly and accurately work a deal based on finance company parameters - like LotPro® from Auto Credit Express.
For more information on LotPro or our other great dealer products, give us a call at 888-535-2277. Or you can fill out our convenient contact form online and we will be in touch.