Both the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC) have continued to be aggressive with enforcement actions and their investigations of industry practices. Dealers who have been paying attention continue to worry about what might be next, and with good reason. The CFPB now asserts that, while a three-year statute of limitations limits the time the Agency has to bring claims in federal court, no statute of limitations applies to administrative actions. The FTC has also expanded its authority by approving 20-year consent decrees and, in some cases, including new and vague compliance standards with no guidance on how dealers can comply with them.
Over the course of the past year, the CFPB has:
In addition to the actions of the CFPB, the FTC has:
Not by coincidence, dealership compliance with federal and state laws is coming under increased scrutiny by state regulators and the lenders who offer financing to dealerships’ customers as well. Dealers across the state of Ohio have received letters from the Office of the Ohio Attorney General alleging violations of both federal and state advertising laws, including claims similar to those asserted by the FTC. Lenders have also been reviewing dealership paperwork much more carefully and have amended their dealer agreements to include broader warranties regarding compliance, more liability shifting provisions, and longer recourse terms.
Staying on top of legal and regulatory developments, implementing appropriate policies and procedures, and training dealership personnel are the keys to success. Don’t become an easy target because you failed to make a modest investment in compliance today! Sign up for OADA’s webinar on October 19, 2016. Deanna Stockamp of Stockamp & Brown LLC will discuss these recent developments and what they mean for dealers, as well as some of the OADA hotline’s most frequently asked compliance questions.
Connection fee for the webinar is $25 per connection, with a $50 connection fee for non-members. Register today!