Connecticut Automotive Retailers Webinar November 8th, 2016
In late September, the Federal Trade Commission announced what is likely the most substantial auto dealer enforcement action in the agency’s history. While most of the FTC’s earlier cases have focused solely on dealer advertising, this action alleges over a dozen different types of violations. And unlike previous cases where there were no initial monetary penalties, this time it looks like they’re seeking massive financial consequences for the dealers involved.
In this informative presentation we’ll examine each of the FTC’s latest claims in detail and discuss best practices on how your dealership can avoid being targeted by federal and state regulators. The game is changing and it pays to be prepared.
In late September, the Federal Trade Commission announced what is likely the most substantial auto dealer enforcement action in the agency’s history. While most of the FTC’s earlier cases have focused solely on dealer advertising, this action against 9 California dealerships alleges over a dozen different types of violations. And unlike previous cases where there were no initial monetary penalties, this time it looks like they’re seeking massive financial consequences for the dealers involved.
In this informative presentation we’ll examine each of the FTC’s latest claims in detail and discuss best practices on how your dealership can avoid being targeted by federal and state regulators. The game is changing and it pays to be prepared.
Avoiding Technical Fouls:Selected Ethical Issues in Advertising, Social Media...Kevin O'Shea
Topics Addressed:
Advertising
LinkedIn
Are Facebook and Twitter Regulated Attorney Advertising?
Group Coupons or Daily Deals for Discounted Legal Services
Social Media
Liability for Posting
Responding to False Accusations/Bad Reviews
Cloud Computing
Confidentiality
Security
Employee Risks
Listservs
In late September, the Federal Trade Commission announced what is likely the most substantial auto dealer enforcement action in the agency’s history. While most of the FTC’s earlier cases have focused solely on dealer advertising, this action against 9 California dealerships alleges over a dozen different types of violations. And unlike previous cases where there were no initial monetary penalties, this time it looks like they’re seeking massive financial consequences for the dealers involved.
In this informative presentation we’ll examine each of the FTC’s latest claims in detail and discuss best practices on how your dealership can avoid being targeted by federal and state regulators. The game is changing and it pays to be prepared.
Avoiding Technical Fouls:Selected Ethical Issues in Advertising, Social Media...Kevin O'Shea
Topics Addressed:
Advertising
LinkedIn
Are Facebook and Twitter Regulated Attorney Advertising?
Group Coupons or Daily Deals for Discounted Legal Services
Social Media
Liability for Posting
Responding to False Accusations/Bad Reviews
Cloud Computing
Confidentiality
Security
Employee Risks
Listservs
DEBT RELIEF SERVICES & THE TELEMARKETING SALES RULE: A Guide for Business- Mark - Fullbright
All information, data, and material contained, presented, or provided on is for educational purposes only.
Company names mentioned herein are the property of, and may be trademarks of, their respective owners.
Three ways to produce ppi reclaim possible Tasha B. Moore
Payment protection insurance mis-selling has been a significant issue within the last few years. Different consumer groups were also conducted their investigations regarding this matter such as the Financial Services Authority and its watchdogs.
Antitrust seminar at 2014 CreditScape, Western Region Credit Conference Seminar Slide Deck, sponsored by Credit Management Association. More information: www.creditmanagementassociation.org
Sportsplexes that sell beer, wine, or liquor to patrons can be held liable for injuries resulting from such sales (both to the patron and to other third parties) under the following circumstances:
For more information and advice, kindly visit our <a>Sports Insurance</a> Website at http://sadlersports.com
At the root of appeals from judgments in commercial cases is the burning question: Does the result make sense from a business perspective? or put in more legally-eloquent language: Does this result meet the test of commercial reasonableness? "Commercial Reasonabless" is a concept Canadian courts address frequently to determine if business conduct or a result makes sense.
This paper will show that in commercial appeals, the Court of Appeal generally operates on the principle of commercial reasonableness. If the relief sought is not commercially reasonable, then you are unlikely to achieve a successful result for your client. I hope to show that appellate courts in Ontario approach appeals involving commercial disputes by asking whether the trial judge’s decision was commercially reasonable. In short, The court will not adopt an interpretation that is clearly commercially absurd.
The author is a senior business litigation and arbitration lawyer in Toronto who has argued many business appeals in the Ontario Court of Appeal. He is also an experienced trial and arbitration counsel. Senior partner of Ellyn Law LLP Business Litigation & Arbitration Lawyers, Mr. Ellyn heads a team of competent litigation lawyer who are at the vanguard of developments of business litigation and arbitration in Ontario. Igor Ellyn is also the Chair of the Business Litigation & Arbitration Practice Group of INBLF.com, the International Network of Boutique Law Firms.
DEBT RELIEF SERVICES & THE TELEMARKETING SALES RULE: A Guide for Business- Mark - Fullbright
All information, data, and material contained, presented, or provided on is for educational purposes only.
Company names mentioned herein are the property of, and may be trademarks of, their respective owners.
Three ways to produce ppi reclaim possible Tasha B. Moore
Payment protection insurance mis-selling has been a significant issue within the last few years. Different consumer groups were also conducted their investigations regarding this matter such as the Financial Services Authority and its watchdogs.
Antitrust seminar at 2014 CreditScape, Western Region Credit Conference Seminar Slide Deck, sponsored by Credit Management Association. More information: www.creditmanagementassociation.org
Sportsplexes that sell beer, wine, or liquor to patrons can be held liable for injuries resulting from such sales (both to the patron and to other third parties) under the following circumstances:
For more information and advice, kindly visit our <a>Sports Insurance</a> Website at http://sadlersports.com
At the root of appeals from judgments in commercial cases is the burning question: Does the result make sense from a business perspective? or put in more legally-eloquent language: Does this result meet the test of commercial reasonableness? "Commercial Reasonabless" is a concept Canadian courts address frequently to determine if business conduct or a result makes sense.
This paper will show that in commercial appeals, the Court of Appeal generally operates on the principle of commercial reasonableness. If the relief sought is not commercially reasonable, then you are unlikely to achieve a successful result for your client. I hope to show that appellate courts in Ontario approach appeals involving commercial disputes by asking whether the trial judge’s decision was commercially reasonable. In short, The court will not adopt an interpretation that is clearly commercially absurd.
The author is a senior business litigation and arbitration lawyer in Toronto who has argued many business appeals in the Ontario Court of Appeal. He is also an experienced trial and arbitration counsel. Senior partner of Ellyn Law LLP Business Litigation & Arbitration Lawyers, Mr. Ellyn heads a team of competent litigation lawyer who are at the vanguard of developments of business litigation and arbitration in Ontario. Igor Ellyn is also the Chair of the Business Litigation & Arbitration Practice Group of INBLF.com, the International Network of Boutique Law Firms.
Unfair and Deceptive Acts and Practices Enforcement: Is your Facility at Risk?Jim Radogna
In this informative webinar, KPA F&I experts Jim Radogna and Ryan Lane will address these potential and legal pitfalls and suggest best practices for avoiding being caught up a “UDAP Trap.”
4 Areas of Operations to Review for Financial OverspendCBIZ, Inc.
Few things can make you more of a hero in your organization than uncovering hidden sources of cash. Accessing savings doesn’t have to mean draconian measures. By taking a comprehensive and creative approach to potential sources of refunds, credits and reductions, you may be able to generate cash that can help your organization prepare for what comes next. Discover four places cash could be hiding in this article.
Tips From an FTC Pro: How to Avoid Becoming an FTC TargetAffiliate Summit
This presentation is from Affiliate Summit East 2018 (July 29 - July 31, 2018 in New York).
Session description: The Trump FTC has been cracking down on Internet marketers and tightening the noose around affiliates and others in their ecosystem. Learn from an FTC expert how to stay compliant and avoid “FTC Jail”.
Unfair and Deceptive Acts & Practices Seminar - Chicago Automobile Trade Asso...Jim Radogna
Dealers have plenty to worry about when it comes to rules and regulations governing the industry, but perhaps the most harrowing are known as “UDAPs”.
Unfair and Deceptive Acts and Practices (UDAP) statutes are consumer protection laws that address what lawmakers consider to be “unethical” or otherwise “bad” business practices. The FTC Act and the Illinois Consumer Fraud and Deceptive Business Practices Act both prohibit unfair or deceptive acts or practices. These statutes have far-reaching implications for auto dealers because they provide for enforcement by the government to stop the practices, individual actions for damages brought by consumers who are hurt by the practices, and even criminal liability.
Dealers need to be aware that these statues are extremely broad and not only prohibit acts and practices that fall directly under the purview of specific laws, but also any other practice that is determined to be unfair or deceptive to the consumer. A behavior can be found to be unfair and deceptive and thus actionable even though it does not constitute fraud, breach of contract, or negligence under more traditional law. As a result, UDAP claims are a favorite among consumer attorneys – especially those seeking class action lawsuits.
There are a wide variety of dealer sales, F&I, and advertising practices that may be considered to be unfair or deceptive by regulators or courts. Some of these are commonly-known, while others may surprise you.
In this informative seminar we’ll address these potential legal pitfalls and suggest best practices for avoiding being caught up in a “UDAP Trap”.
This seminar is highly recommended for dealership upper management as well as sales managers, F&I personnel, sales consultants, and others – anyone who interacts with, or markets to, consumers.
This White Paper is written by Paul J. Smith, AIF and Gary Sutherland, CIC, MLIS from NAPLIA.
The paper discusses E&O Coverages basic procedures and how the industry has arrived at this point.
Renewing your Mortgage should be treated like a negotiation. All the Lenders want your business! Arm yourself with knowledge to get the best rate for your mortgage.
Which Gov't Agencies are Targeting Auto Dealers… and How to Reduce Your ExposureJim Radogna
Discover the Top Areas for Enforcement and Penalty Currently Costing Other Dealerships a Bundle! High Risk Areas for All Dealership Departments.
When it comes to government regulation and enforcement it seems that Auto Dealerships have a huge target painted on the rooftop.
Laws and regulations impacting auto dealers are many. However, this workshop we will focus on the top enforcement threats facing most auto dealers today and how you can prepare and adjust to lessen your dealership's exposure.
You will learn:
Which Federal & State Regulators are most active in dealerships right now
The most common enforcement actions taken against dealerships today
About the specific enforcement cases and the resulting monetary damages
Specific risks for Variable Operations, Fixed Operations & Human Resources
Best Practices to Avoid these very real potential liabilities
Using Transparency as a Competitive Advantage - Winning Strategies for Today’...Jim Radogna
Auto dealers are constantly looking for ways to get an edge in the digital age, yet many continue to follow the same sales and advertising practices that they’ve been using for decades. Let’s face it, consumers have access to much more information, and choices, than ever before. In the past the dealer controlled all of the information, but today it’s just the opposite. Any information you offer is now carefully scrutinized and validated by a vast amount of online data. As a result, the likelihood of old-school sales practices backfiring has increased substantially. In this dynamic session, I’ll be discussing ways to break down deep-rooted stereotypes and embrace the transparency that consumers have been begging for. A transparent business model can greatly enhance your sales, reputation, customer retention, and bottom line. You’ll find that customers will actually be willing to spend more when they feel they’re buying from a business they can trust.
Comprehensive program for Agricultural Finance, the Automotive Sector, and Empowerment . We will define the full scope and provide a detailed two-week plan for identifying strategic partners in each area within Limpopo, including target areas.:
1. Agricultural : Supporting Primary and Secondary Agriculture
• Scope: Provide support solutions to enhance agricultural productivity and sustainability.
• Target Areas: Polokwane, Tzaneen, Thohoyandou, Makhado, and Giyani.
2. Automotive Sector: Partnerships with Mechanics and Panel Beater Shops
• Scope: Develop collaborations with automotive service providers to improve service quality and business operations.
• Target Areas: Polokwane, Lephalale, Mokopane, Phalaborwa, and Bela-Bela.
3. Empowerment : Focusing on Women Empowerment
• Scope: Provide business support support and training to women-owned businesses, promoting economic inclusion.
• Target Areas: Polokwane, Thohoyandou, Musina, Burgersfort, and Louis Trichardt.
We will also prioritize Industrial Economic Zone areas and their priorities.
Sign up on https://profilesmes.online/welcome/
To be eligible:
1. You must have a registered business and operate in Limpopo
2. Generate revenue
3. Sectors : Agriculture ( primary and secondary) and Automative
Women and Youth are encouraged to apply even if you don't fall in those sectors.
Why Is Your BMW X3 Hood Not Responding To Release CommandsDart Auto
Experiencing difficulty opening your BMW X3's hood? This guide explores potential issues like mechanical obstruction, hood release mechanism failure, electrical problems, and emergency release malfunctions. Troubleshooting tips include basic checks, clearing obstructions, applying pressure, and using the emergency release.
Core technology of Hyundai Motor Group's EV platform 'E-GMP'Hyundai Motor Group
What’s the force behind Hyundai Motor Group's EV performance and quality?
Maximized driving performance and quick charging time through high-density battery pack and fast charging technology and applicable to various vehicle types!
Discover more about Hyundai Motor Group’s EV platform ‘E-GMP’!
"Trans Failsafe Prog" on your BMW X5 indicates potential transmission issues requiring immediate action. This safety feature activates in response to abnormalities like low fluid levels, leaks, faulty sensors, electrical or mechanical failures, and overheating.
What Does the PARKTRONIC Inoperative, See Owner's Manual Message Mean for You...Autohaus Service and Sales
Learn what "PARKTRONIC Inoperative, See Owner's Manual" means for your Mercedes-Benz. This message indicates a malfunction in the parking assistance system, potentially due to sensor issues or electrical faults. Prompt attention is crucial to ensure safety and functionality. Follow steps outlined for diagnosis and repair in the owner's manual.
Fleet management these days is next to impossible without connected vehicle solutions. Why? Well, fleet trackers and accompanying connected vehicle management solutions tend to offer quite a few hard-to-ignore benefits to fleet managers and businesses alike. Let’s check them out!
Things to remember while upgrading the brakes of your carjennifermiller8137
Upgrading the brakes of your car? Keep these things in mind before doing so. Additionally, start using an OBD 2 GPS tracker so that you never miss a vehicle maintenance appointment. On top of this, a car GPS tracker will also let you master good driving habits that will let you increase the operational life of your car’s brakes.
5 Warning Signs Your BMW's Intelligent Battery Sensor Needs AttentionBertini's German Motors
IBS monitors and manages your BMW’s battery performance. If it malfunctions, you will have to deal with an array of electrical issues in your vehicle. Recognize warning signs like dimming headlights, frequent battery replacements, and electrical malfunctions to address potential IBS issues promptly.
In this presentation, we have discussed a very important feature of BMW X5 cars… the Comfort Access. Things that can significantly limit its functionality. And things that you can try to restore the functionality of such a convenient feature of your vehicle.
What Exactly Is The Common Rail Direct Injection System & How Does It WorkMotor Cars International
Learn about Common Rail Direct Injection (CRDi) - the revolutionary technology that has made diesel engines more efficient. Explore its workings, advantages like enhanced fuel efficiency and increased power output, along with drawbacks such as complexity and higher initial cost. Compare CRDi with traditional diesel engines and discover why it's the preferred choice for modern engines.
Ever been troubled by the blinking sign and didn’t know what to do?
Here’s a handy guide to dashboard symbols so that you’ll never be confused again!
Save them for later and save the trouble!
Symptoms like intermittent starting and key recognition errors signal potential problems with your Mercedes’ EIS. Use diagnostic steps like error code checks and spare key tests. Professional diagnosis and solutions like EIS replacement ensure safe driving. Consult a qualified technician for accurate diagnosis and repair.
1. ADVERTISING & THE DIRTYADVERTISING & THE DIRTY
DOZENDOZEN
Presented by:
Jim Radogna
KPA Senior Sales & Finance
Compliance Specialist
2. KPA delivers Environmental Health & Safety, HR Management and Sales & Finance
Compliance programs with a vision of creating a Better Workplace, Better Workforce, and a
Better World. Over 6,500 clients, across 48 states look to KPA as their compliance partner
providing solutions through a combination of innovative software, interactive training and on-
site consulting, resulting in increased production and profits.
A comprehensive solution for Environmental Health & Safety,
HR Management, and Sales & Finance Compliance.
KPA:KPA: Environmental Health & Safety | HR Management |Sales & Finance Compliance
3. Questions
• If you have questions
during the presentation,
please submit them using
the “Questions” feature
• Questions will be
answered at the end of the
webinar
•If your question does not
get answered, we will
reach out to you
individually
4. Disclaimer
The material provided in this presentation is for informational and
educational purposes only. It is intended to give only a general
overview of the laws and regulations governing the automotive
industry, not to provide legal advice.
KPA LLC is not a law firm and does not dispense legal advice. If you
need specific legal advice, you should seek it from a competent
professional licensed to practice in your state.
KPA LLC specifically disclaims any personal liability, loss or risk
incurred as a consequence of the use, either directly or indirectly,
of any information given in this presentation.
5. The FTC Strikes Again
In September of 2016, the FTC charged nine California auto dealerships and their
owners with using a wide range of deceptive and unfair sales and financing
practices.
Up until now, FTC primarily charged dealers with advertising violations
FTC is no stranger in Connecticut - 2 CT dealers in 1st
ad action
6. What A Deal!
Actual amount due at lease signing is $2695
$38 payment increases to $179 after first 6 months
Offer does not prominently disclose that it’s a lease
Hidden material terms with miniscule fine print or with cursory, inconspicuous
disclaimers.
7. Who Qualifies?
The “See Details” link on either the website or Facebook post did not disclose
any additional material terms of the offers.
Advertised terms are not generally available to consumers, for instance
Loyalty, College Grad, certain credit scores, and financing with captive lender
In numerous instances, even if consumers meet all of the qualifications or
restrictions, they cannot obtain the advertised discount and price
8. Back to the Future
“We can pay off your trade-in even if you owe on a loan or lease”
“Negative equity may be added to new loan or lease balance” disclosed in fine
print
9. Some Thoughts From Regulators’ Standpoint…
A favorite mindset among regulators is that “what the large print giveth, the small print
can’t taketh away”.
The public is not under any duty to make a reasonable inquiry into undisclosed aspects of
a representation or advertisement. The burden is on the dealer to tell the truth, the whole truth,
and nothing but the truth.
A practice is deceptive even if subsequently clarified. Point of sale disclosure is not
sufficient to clarify deceptive media advertising. For example, the claim “we’ll pay off your
trade no matter what you owe” has been found to be deceptive even though the dealer
discloses that negative equity is added to the purchase contract at the time of sale.
See dealer for details” disclaimer may not protect you as much as you would like.
A merger clause or a contract provision that “no agreement between salesman and
customer is binding on the company” or otherwise disclaiming oral representations does not
defeat a UDAP action based on an employee’s misrepresentations.
10. Claim #1
Advertisements in English, Spanish, and other languages, making enticing
claims about key terms, such as low sales prices, low monthly payment
amounts, and low down payment amounts.
Frequently misrepresented these claims and have hidden additional material
terms that have significantly qualified or contradicted the prominently advertised
terms.
In some instances, Defendants have only provided these additional terms in
English, even when the advertisements otherwise have been presented in another
language.
11. Claim #2
Subjected individuals with poor credit, to deceptive, misleading, and unfair
practices when offering add-on products and services or when arranging
financing
UDAP Reality Check: Vulnerable consumers are often specially considered in
UDAP claims (including elderly, credit-challenged, and non-English proficient)
12. Claim #3
Approving deals to customers with risky credit before bank financing had
been secured in order to increase their sales numbers knowing that the
dealership was not going to be able to secure bank financing on the offered
terms. Such tactics are often known as “yo-yo practices.”
Even after consumers have signed a contract and driven the vehicles off
defendants’ lots, defendants have used deceptive and unfair tactics to pressure
consumers to agree to different financing terms such as higher interest rates, and
additional down payments.
Representing to consumers that they must sign the new contract when dealers
failed to assign financing
13. Claim #4
Where a consumer has refused unlawful demands to sign a new contract or
to return the vehicle, dealers have falsely represented that consumers will
be liable for legal action, including lawsuits, repossession, or criminal arrest
for a stolen vehicle.
14. Claim #5
Refusing to return the consumer’s down payment or trade-in vehicle
Where dealers have not assigned financing and have sent notice cancelling the
deal, dealers represented that they are not required to return any consideration
provided by the consumer, including any down payment or trade-in vehicle.
16. Claim #7
Deceptively claimed that add-on products are required as a condition of the
purchase or financing of the vehicle or will improve consumers’ chances of
obtaining financing.
Offered one consumer a contract with a 5.05% APR, instead of 11.99%, but had
represented that the financing company required her to purchase a warranty to
receive the lower APR
Required consumer to purchase GAP to obtain better financing
Required consumer to buy a $900 protection plan to purchase the vehicle
17. Claim #8
Selecting and preprinting add-on products on the sales and financing forms, such
as the F&I product menus and the contract, before discussing or presenting them
to the consumer.
18. Claim #9
Packed additional charges for add-on products and service into the amount
financed without consumers’ informed consent
Included a VIN etching fee in their contract that the customer did not authorize
Added a service contract that the consumer was not told about and did not want to
purchase.
Charged for add-on products that the consumers had rejected
Telling consumers that they could cancel the add-on products within a specified time
for a refund and failing to process the paperwork or have claiming to have lost the
paperwork, resulting in delayed cancellations or lower refund payments
19. Claim #10
Telling consumers that they would not be charged the cost of the add-on
products when in fact they were
Promised consumers two years of free oil changes and tire rotations if they
purchased the vehicle then charged the consumers for pre-paid maintenance
agreements
UDAP Reality Check: A statement or omission may convey more than one reasonable
meaning, and if one of those meanings is deceptive, it violates UDAP statutes. A good
example would be where a dealer employee claims that a service contract is “included” in a
payment quote. A reasonable meaning to a consumer is that “included” means “free” or “at no
additional cost.”
20. Claim #11
Rushing consumers through the closing process and simply indicating to
consumers where to sign in a stack of lengthy, complex, highly technical
documents presented at the close of a long financing process after an already
lengthy process of selecting a car and negotiating over its price.
Obtaining consumer signatures purporting to indicate assent to purchase add-on
products even though consumers did not, in fact, authorize the purchase.
Requiring consumers to sign for GAP and service contracts regardless of whether the
consumers were actually purchasing the add-on products.
Having consumers sign blank documents
UDAP Reality Check:
Disclosure of important
missing information just as the
contract is being signed does
not prevent the previous
failure to disclose from being
deceptive
Myth Busted: A common
misconception is that
only written agreements
are enforceable and oral
agreements are
irrelevant once the
customer signs a
contract.
21. Claim #12
Dealership employees and their families posting positive, five-star reviews
of the dealerships on websites that deceptively purport to be objective or
independent
22. Why Did the FTC Target These Particular Dealers?
Consumer Complaints
Information From Former Employees
HOWEVER… No customer
complaints are necessary and
even inadvertent violations are
actionable
23. What is the Potential Cost to These Dealers?
The FTC is requesting that the court assess the following penalties against the dealers:
Permanent injunctive relief to prevent future violations of the FTC Act, TILA, Regulation Z, the
CLA, and Regulation M
Relief to redress injury to consumers
Rescission or reformation of contracts
Restitution to consumers
Refund of monies paid
Disgorgement of ill-gotten monies
FTC’s costs and legal fees
Any additional relief as the Court may determine to be just and proper
FTC’s maximum penalty increased from $16k to $40k per violation on August 1st
Penalties can be assessed per violation, per day
Dealership owners named personally in addition to their companies
Punitive damages are not generally insurable in California or Connecticut and insurance
companies could fight payment of other penalties under the concept of “intentional wrong
acts”
24. What is the Potential Cost to These Dealers?
Common Liability Policy exclusions:
Intentional wrongful acts
Gaining of any profit or advantage to which you are not legally entitled
Claims arising out of false advertising or misrepresentation in advertising
Unfair or deceptive business practices, or violations of any consumer
protection laws
Claims against you that are brought by or on behalf of any federal, state or
local government agency
Claims arising out of the same wrongful act or series of continuous,
repeated or related wrongful acts, alleging the same or similar facts
26. Contact Information
More Questions?
Jim Radogna
jradogna@kpaonline.com
Rob Stansbury
rstansbury@kpaonline.com
Questions on materials
presented
Questions on how KPA works with
their customers on these issues