日本高清 Insights
Get the latest news, views, videos, and helpful tips and information from your friends and partners at 日本高清!
Agents: A Compliance Officer Could Help Your Dealerships Save Millions
Oct 4, 2023
Dealers, F&I, Training
by Melinda O'Connell
Senior Content Editor
Despite dealerships being required by law to have a dedicated compliance officer, many still don’t have one. Dealerships often still function the way they always have because “that’s how they’ve always done things.” But the truth is, the state of automotive laws these days requires a change. Without a compliance officer, dealers are at risk of having to pay out thousands and even millions in penalties for violations if they’re not up to date on compliance.
Violations can range from bank fraud and falsifying credit applications to simply forgetting to put customer paperwork away. Whether intentional or careless, these kinds of mistakes can cost anywhere from $3,500 to $25,000 per violation, or more. A UDAAP violation (unfair, deceptive, or abusive act or practice) can cost up to $1 million per day.
With the CFPB cracking down more and more on dealership compliance violations and the laws regarding dealership operations being in constant flux, dealerships should be taking the role of compliance officer very seriously. Attorneys Terry O’Loughlin of Reynolds and Reynolds and Randy Henrick of Ignite Consulting Partners – both of whom have served in myriad compliance roles for dealer and consulting groups across the country – recommend a permanent compliance officer who reports to the dealership or dealer group board of directors. The role also should not be filled by someone who also holds another position in the dealership; this is in order to prevent conflicts of interest and distraction from the compliance focus. There is certainly enough compliance responsibility to warrant a separate, full-time role.
For those who need a starting point, the (ADCO) is a valuable resource for helping compliance officers get started and excel in their role. ADCO offers certification, compliance webinars, and ongoing compliance support.
Help your dealers maintain a positive reputation and be proactive against compliance penalties by talking to them about a dedicated compliance officer.