On a busy Saturday at a dealership, what is sometimes the first corner to be cut in the sales process can be the costliest. Something as simple as taking a photo of a customer’s driver’s license when that potential buyer is in a hurry to take a test drive can result in big fines. Beyond that, there are many other pitfalls from lead to sale.
The newly expanded FTC Safeguards rule takes effect June 9, 2023, and requires administrative, physical, and technical compliance to ensure the security and confidentiality of consumer information, prevent unauthorized access to consumer information, and to protect against any threats or hazards to the security or integrity of that information. Whether you’re the owner, General Manager, Dealer Principal, F&I Manager, or General Sales Manager, the new guidelines impact you.
These compliance requirements can have a huge impact on your dealership if you’re not prepared and will result in devastating fines.
Most dealers struggle with what the sales team collects, creates, and controls, which is why they need a platform to enforce compliance across the four “Ps”: people, policies, paperwork, and process.
Here are five of the top violations that involve those four Ps and that are putting your dealership at risk and how leading dealers avoid them.
VIOLATION 1:
Not having a way to enforce a consistent, compliant process on every single deal. The saying is “hope is not a strategy”, but that’s what many dealers rely on when it comes to compliance. Whether you have a busy dealership, staff turnover or haven’t consistently trained your staff, your dealership needs an enforceable physical and administrative compliance process that leverages technology to ensure your dealership is compliant. Bonus points if the solution is one that your team will love and will help them sell cars faster (like ours).
VIOLATION 2:
Sales staff storing consumer information on their cell phone or personal email. Really, it’s not just the sales staff. At a recent NADA, a GM confessed to having hundreds of driver’s license photos on his phone. This seemingly “easy” way to capture the information is extremely costly. By using a solution with an app (like ours), you can quickly capture the driver’s license details AND check for fraud.
VIOLATION 3:
Not securely sending and receiving consumer information for remote deals. Instead of having buyers email or text information to your staff—which is not compliant—send them a secure link (like our tech has) that allows them to upload the documents you need to process the sale.
VIOLATION 4:
Private consumer information is left exposed in insecure locations. Think – salesperson’s desk, the copy machine, or as we saw on a recent visit to a dealership – in bins in a hallway leading to the bathrooms. All this exposed personal information leaves you at risk for violations and hefty fines. Leveraging a platform that almost completely eliminates paper (like ours) protects your dealership and your customers.
VIOLATION 5:
Not storing dead deals for the required 5 years. That’s a lot of deals with lots of personal information that you’re responsible for storing, protecting, and PROVING that you’re retaining. Our solution stores the dead deal jackets electronically and supports your compliance checks.
Did you know? Credit Bureau Connection (CBC), Dealer Safeguard Solutions (DSGSS) and CreditDriver are now Informativ. Learn more about our new name and the only complete and proactive credit and compliance solution from lead to sale, here.