Pub. 1 2019 Issue 2

W hen legislation is overly broad, being compli- ant with that legislation becomes extremely difficult. Automotive compliance provides a good example. Dealerships are subject to a seem- ingly unending list of regulations that affect almost every aspect of running the business, and failing to comply can create serious trouble. All of the follow- ing are regulated: • Buying • Communicating with customers • Financing • Formatting emails • Insuring • Preventing identity theft • Reporting cash payments that are excessively large • Selling Consider the following: • Cash payments: If a dealership accepts an ex- tremely large cash payment, the IRS wants to know about it less than two weeks after a sale has been made. Failure to report exposes dealerships to the very real possibility of big fines and time in jail. • Customer communication: There are many dif- ferent ways to communicate with customers, but there are also many rules about how that communication is to take place. Most states have rules about how a vendor can contact someone, not to mention limited contact times. Dealerships are required to honor “Do Not Call” lists, must follow rules about the information that is included in email messages, and are also restricted when it comes to using pre-recorded messages. • Identity theft: If a dealership doesn’t follow pro- cedures to prevent identity theft, not only does the dealership lose valuable inventory, it can be held legally accountable for not catching the person who committed the robbery. What can you do to protect yourself when it comes to automotive compliance? • Choose a compliance officer • Train the dealership’s staff • Put your dealership association to work Choose a compliance officer One smart strategy is to have a compliance officer whose job is to make sure business problems are being solved correctly. Why should dealerships have a spe- cialist instead of delegating to a general manager or a sales manager? The following reasons apply: • As should already be obvious, keeping a dealer- ship compliant is a fulltime effort all by itself. For Dealerships and Automotive Compliance 10 Issue 2 2019