You’re probably thinking…”We’ve heard this before, nothing new.” But according to Jim Radogna (Director of Compliance for the Lloyd Andersen Group of Companies), there’s a profound change occurring in the car business legal environment…not only for dealers, but for everyone.
According to Jim, it’s no secret for the last few years federal and state regulators have sent a clear signal that they’re fed up with what they consider to be deceptive practices in the auto industry…and they’ve placed a bull’s eye squarely on the backs of car dealers…going directly after dealership staff.
Jim says this latest indictment resulted from practices that have been around for many years and are still common in some dealerships. Those would include: creating or altering documents to submit to financial institutions to show inflated income. Misrepresenting proof of a customer’s residency, as well as unlawful use of a customer’s personal identification.
Also charges included listing accessories not actually included on a vehicle so a financial institution would increase its loan amount, utilizing straw buyers, and quoting customers an inflated monthly vehicle loan payment so that a finance manager could add a service contract and gap insurance without the customer realizing it.
Sales managers, a finance manager, a GSM, and three salespeople were indicted. So if you’re involved in any aspect of selling a car, you could be at risk. To see what Jim suggest doing to improve compliance at your dealership, check out the article he wrote for Car Biz Today Magazine, right here on this site. It’s the industry’s hottest magazine on finding topics and trends for every department of your dealership.