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Compliance

New CARS Rule Lesson: Go Back to F&I Training

Does it ever feel like once a year, compliance rears back up to take over the headlines, only to die down again? Well compliance is back and it is making waves.

At the end of 2023, the Federal Trade Commission (FTC) announced the Combating Auto Retail Scams (CARS) Rule, targeting unwanted products, services and so-called ‘junk fees’ added on to a car purchase.

The CARS Rule specifically provides protection for military and active-duty service members who, according to the FTC, are frequently targets for vehicle scams. The FTC states that service members have an average of twice as much auto debt as civilians.

Categories
Compliance

Product Provider Compliance Checklist

Contributing Author: Steve Roennau Vice President Compliance EFG Companies
Contributing Author:
Steve Roennau
Vice President
Compliance
EFG Companies

Did you know that automotive dealerships must comply with roughly 60 retail automotive regulations in addition to the regulations for employers, small businesses, advertisers, general retailers, and finance organizations?

These rules touch a broad range of issues, including environmental, tax and finance rules, and a host of other consumer protections. It’s no wonder that compliance seems overwhelming.

The good news is that there are services available to help dealerships tackle compliance by taking a very methodical, common sense approach.

You’ve probably seen agents and product providers step-up their service model to include more services around compliance. This is actually an objective and cost-effective way in which to tackle improving compliance in your dealership.

Ask yourself:

  • Beyond in-store engagement, what compliance services do they provide?
  • Does my product provider see compliance as important enough to include a head of compliance on their corporate leadership team?
  • What compliance certifications does my product provider have?
Categories
Compliance

Catch-22 F&I Performance Objectives

Contributing Author: David Robertson, Executive Director, Association of Finance & Insurance Professionals
Contributing Author:
David Robertson, Executive Director, Association of Finance & Insurance Professionals

The number of F&I professionals laboring under impossible F&I performance bogies appears to be on the decline. However, enough still struggle to warrant addressing the inequity of this scenario – with a few tips on personally avoiding the catch-22 trick bag.

The story is always the same. You must meet two requirements to keep your job. First, you can’t cheat the customers – commit an illegal or unethical act – or you’ll get fired. Second, you must consistently hit your performance quotas – IPRU, product penetration thresholds or a combination of both – or it’s adiós as well.

On their face, both requisites appear to be reasonable demands by any employer, regardless of the industry. However, in our business, they can carry a sinister and unspoken twist. By design, it’s virtually impossible to achieve the production thresholds set by management without “cutting corners” at some point in the F&I process.