Non-compliance with rules, laws and regulations can cost a dealership a significant amount of money, not to mention the possibility of incarceration.  Here are just a few items you should be aware of:

• You must check the Specially Designated Nationals List (SDN), also known as the “OFAC List,” for every customer you do business with.  If you perform transactions with a “blocked person,” you may be fined between $50,000 and $10 million with the possibility of incarceration.

• The Form 8300 must be filed with the Internal Revenue Service within 15 days of the date the cash was received.  The dealership must also have an anti-money laundering compliance program.  This program must be in writing and be designed to prevent the dealership from facilitating money laundering and the financing of terrorism.  Non-compliance with these guidelines may result in fines of $25,000 to $500,000 and possible jail time.

• Failure to comply with the Federal Trade Commission’s Do-Not-Call Implementation Act of 2003, and subsequent Do-Not-Call Improvement Act of 2007, may cost $11,000 or more.

• The Gramm-Leach-Bliley Financial Modernization Act of 1999 requires companies to give consumers privacy notices that explain the information-sharing practices of the dealership.  These privacy notices must be given to the customer at the time of the initial transaction and on an annual basis if their account remains open.  Failure to do so may cost as much as $11,000.

• The Federal Trade Commission’s (FTC) Used Car Rule requires dealerships to post a Buyer’s Guide on every used vehicle.  If the sales transaction is conducted in the Spanish language, the dealership is required to have the customer sign a Spanish version of the Buyer’s Guide.  Non-compliance can cost you $250 to $11,000 per occurrence.

• Most states require that the title be transferred to the new owner within 30 days of the transaction.  The fines vary by state, contact your local motor vehicle department for details.

Federal regulations regarding documentation and compliance are constantly being implemented and updated. How do you know if your employees are following all of the policies and procedures you have in place?  Let us help you.  Check out our website to see what types of services we provide and what we can do to make your life easier. 

Amber Powell