Moreover, according to the FTC, many of the prohibitions and requirements of the Rule are simply a codification of the current rules. In other words, regardless of the CARS Rule’s ultimate outcome, dealers need to understand and implement changes to their advertising, F&I and related practices. Here are some key actions that dealerships can implement now to be ready for the Rule: 1. Review and Revise Advertising Practices One of the central components of the Rule is its focus on advertising transparency — particularly price advertising. Dealers should consistently audit all advertising materials, including online listings, vehicle display pages, TV spots, print ads and social media campaigns, to ensure they will be in compliance with the Rule’s requirements. The Rule, if passed, will include an obligation for dealers to clearly display the “Offering Price” on advertisements for specific vehicles or that reference monetary amounts or financing terms. The Offering Price is the all-in cash price that a dealer will sell a vehicle to any buyer excluding only charges imposed by the government; therefore the Offering Price must include document processing fees, dealer preparation charges, mandatory add-ons, etc. Dealers must also clearly disclose the total of all payments if a monthly payment is mentioned. Additionally, dealers must avoid misrepresentations and if optional add-ons are mentioned, must disclose that optional add-ons are not required. It’s essential to work with vendors that understand the Rule to develop ads that align with the Rule’s requirements. 2. Implement Comprehensive Disclosure Processes To comply with the Rule’s strict disclosure requirements, dealers must establish clear and consistent communication practices. Employees should be trained to provide these disclosures both in writing and verbally, particularly regarding the Offering Price, during the first communication with consumers about a specific vehicle — whether that interaction occurs in person, online or over the phone. Dealers should revise their sales processes to ensure that all consumer interactions include the necessary disclosures, such as the total cost of the vehicle over the loan term, the Offering Price and the consumer’s express informed consent. Many of these disclosures will need to be documented in writing to demonstrate compliance. Dealers should begin working with their forms providers to prepare for the updated forms requirements. 3. Plan for Obtaining and Documenting Express Informed Consent The Rule requires dealers to obtain express informed consent before charging consumers for any item, including mandatory and optional add-ons. Dealers should establish systems that document each step of consumer consent, from initial disclosures to final purchase agreements. This may include updated desking sheets, F&I menus and digital tools to ensure that customers fully understand and agree to all charges. Dealerships should also evaluate their customer relationship management (CRM) systems, desking systems and digital tools to centralize and automate this process where possible. 4. Upgrade Recordkeeping Systems With the Rule’s 24-month recordkeeping requirement, dealerships must ensure that they create all records required to establish compliance with the Rule, and then have the infrastructure to store detailed records for every transaction. This includes maintaining copies of advertisements, purchase orders, consumer communications and evidence of express informed consent. Dealers should consider investing in centralized digital systems to retain and organize these records, ensuring they can be easily retrieved in the event of an FTC inquiry. Working closely with CRM and DMS providers will be critical to meeting these obligations. Dealers should begin to ensure that their providers are ready for the Rule’s recordkeeping requirements. 5. Train Employees on the New Compliance Standards The success of any compliance program hinges on employee training. Dealers should begin training their sales, finance, and marketing teams on the key elements of the Rule, ensuring that all staff understand the requirements around disclosures, advertising and recordkeeping. Of particular 45 MONTANA AUTO DEALER
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