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.”
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.
The Law of Unfair Trade Practices: Practical tips for deadling with unfair tr...EllisWinters
The talk is nationwide in scope, but it includes plenty of North Carolina examples. In the talk, I lay out the general shape of the law on unfair trade practices, including some infamous recent cases from California and New Jersey.
See especially slides 6-14, where I describe how section 75-1.1 fits into the range of similar statutes nationwide.
Enterprise Act 2016 and its impact on brokers - survey resultsBrowne Jacobson LLP
From 4 May 2017, the Enterprise Act updated the law to enable policyholders to recover unlimited damages caused by the late payment of claims from insurers. This is not a penalty against insurers for negligently delaying payment. Policyholders must demonstrate and evidence the actual loss they have suffered and show that it was caused by a delay in the payment of a claim. Any damages claim against the insurer must be brought within 1 year of the claims payment under the policy.
We have conducted a survey of insurers, brokers and loss adjusters to understand the expected impact of the Act. Here’s a summary of the key findings.
Visit our hub to access information and resources tailored to brokers: www.brownejacobson.com/brokers
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.
The Law of Unfair Trade Practices: Practical tips for deadling with unfair tr...EllisWinters
The talk is nationwide in scope, but it includes plenty of North Carolina examples. In the talk, I lay out the general shape of the law on unfair trade practices, including some infamous recent cases from California and New Jersey.
See especially slides 6-14, where I describe how section 75-1.1 fits into the range of similar statutes nationwide.
Enterprise Act 2016 and its impact on brokers - survey resultsBrowne Jacobson LLP
From 4 May 2017, the Enterprise Act updated the law to enable policyholders to recover unlimited damages caused by the late payment of claims from insurers. This is not a penalty against insurers for negligently delaying payment. Policyholders must demonstrate and evidence the actual loss they have suffered and show that it was caused by a delay in the payment of a claim. Any damages claim against the insurer must be brought within 1 year of the claims payment under the policy.
We have conducted a survey of insurers, brokers and loss adjusters to understand the expected impact of the Act. Here’s a summary of the key findings.
Visit our hub to access information and resources tailored to brokers: www.brownejacobson.com/brokers
Learn What to Do After a Car Accident That Is Not Your FaultDavid Azizi
In this presentation, David Azizi will help you understand the answers to the most common question people ask if they’re hurt, their car is damaged and they’re not able to work: what happens now?
Learn what steps are taken after a car accident, making sure you have the adequate insurance to prevent calamity.
Original source: https://www.azizilawfirm.com/car-accident-lawyer/after-wreck-not-your-fault
The Insurance Act 2015 has introduced the most significant reform to insurance law in over 100 years. The Act impacts all those involved in the insurance sector. In this report we review key markets' response to the Act and outline the practical steps you should have addressed ahead of the Act coming into force.
Visit our hub to access information and resources tailored to brokers: www.brownejacobson.com/brokers
The purpose of this presentation is to show, Realtors and Investors, why working with us on your short sale properties is extremely beneficial. We are a preferred investor with the majority of lenders and have direct contacts to expidite the process.
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
Xergy Consulting surveys the programs, standards, and metrics used to evaluate the environmental performance of data centers. What are we missing? What information do we lack to fully evaluate the greenness of clouds?
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.
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”.
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
Learn What to Do After a Car Accident That Is Not Your FaultDavid Azizi
In this presentation, David Azizi will help you understand the answers to the most common question people ask if they’re hurt, their car is damaged and they’re not able to work: what happens now?
Learn what steps are taken after a car accident, making sure you have the adequate insurance to prevent calamity.
Original source: https://www.azizilawfirm.com/car-accident-lawyer/after-wreck-not-your-fault
The Insurance Act 2015 has introduced the most significant reform to insurance law in over 100 years. The Act impacts all those involved in the insurance sector. In this report we review key markets' response to the Act and outline the practical steps you should have addressed ahead of the Act coming into force.
Visit our hub to access information and resources tailored to brokers: www.brownejacobson.com/brokers
The purpose of this presentation is to show, Realtors and Investors, why working with us on your short sale properties is extremely beneficial. We are a preferred investor with the majority of lenders and have direct contacts to expidite the process.
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
Xergy Consulting surveys the programs, standards, and metrics used to evaluate the environmental performance of data centers. What are we missing? What information do we lack to fully evaluate the greenness of clouds?
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.
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”.
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
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.
On 25 September, Michael Jerabek from the Australian Competition and Consumer Commission addressed the MDCC about such topics as small businesses & the Competition and Consumer Act, advertising & selling, social media and much more.
When a business becomes financially troubled, the business owner often experiences denial, paralysis, or both. Lenders commonly lose confidence and then trust in the business, as communications tend to break down, deadlines are missed, and promises are broken. Small business owners commonly have issued personal guarantees, so business failure can often lead to personal financial stress. The good news is the business and business owner usually has some options, and even some leverage. This webinar explains what a business owner should- and should not- consider and do when dealing with financial trouble. Specific topics include discussion of bankruptcy (Chapters 7 and 11); assignments for the benefit of creditors; and friendly foreclosures. This webinar provides the business owner and her advisors with an overview of various restructuring and liquidation methods, a framework for how to decide between them, and practical tips for traversing the difficult environment that is financial distress.
Part of the webinar series:
RESTRUCTURING, INSOLVENCY & TROUBLED COMPANIES 2022
See more at https://www.financialpoise.com/webinars/
Part of the webinar series: Cross-Training for Business Lawyers 2021
Credit insurance, also called trade credit insurance or business credit insurance, is insurance for businesses for non-payment of commercial debt. It is generally offered by private insurance companies to businesses seeking insurance for non-payment due to a customer’s bankruptcy or other types of financial difficulties. It can be a critical information and hedging tool for businesses with income streams heavily dependent upon accounts receivable from customers with questionable credit worthiness or that may be facing an industry-based or regional-based financial downturn. The premium is generally based upon a financial review of the customers of the business. This webinar covers these and related topics.
This presentation discusses how to select, protect and properly use a trademark so it can become a powerful brand for your products and services.
As well, it discusses "hot issues" in promotions and advertising law, including:
- recent Competition Bureau enforcement regarding misleading advertising;
- the use of social media in contests and promotions, including the need for transparency when engaging bloggers, endorsers and other "influencers" to promote your brand.
Expat Health Insurance - The Onshore/Offshore ConundrumDavid Christensen
Health insurance for expats - what are the advantages and disadvantages of onshore and offshore insurers and advisers. Written with specific reference to Thailand but applicable in all countries.
Showing Licensed Insurance Agents how to Leverage the Benefits, Value, Impact and Advantages of Making LegalShield a Partner For Your Growth and Security
Help, My Business is In Trouble! (Series: Restructuring, Insolvency & Trouble...Financial Poise
When a business becomes financially troubled, the business owner often experiences denial, paralysis, or both. Lenders commonly lose confidence and then trust in the business, as communications tend to break down, deadlines are missed, and promises are broken. Small business owners commonly have issued personal guarantees, so business failure can often lead to personal financial stress. The good news is the business and business owner usually has some options, and even some leverage. This webinar explains what a business owner should- and should not- consider and do when dealing with financial trouble. Specific topics include discussion of bankruptcy (Chapters 7 and 11); assignments for the benefit of creditors; and friendly foreclosures. This webinar provides the business owner and her advisors with an overview of various restructuring and liquidation methods, a framework for how to decide between them, and practical tips for traversing the difficult environment that is financial distress.
To view the accompanying webinar, go to: https://www.financialpoise.com/financial-poise-webinars/help-my-business-is-in-trouble-2021/
Negotiating the terms of a buy/sell agreement (i.e. an M&A transaction) requires both knowledge of the law and the “market.” This webinar involves the panelists engaging in mock negotiations of a variety of deal points which commonly arise in M&A transactions. Listen in as buyer’s and seller’s counsel haggle over representations, warranties, indemnification, purchase price payment mechanisms, and a host of other hotly negotiated terms.
Part of the webinar series: M&A BOOT CAMP 2021
See more at https://www.financialpoise.com/webinars/
Similar to Unfair and Deceptive Acts and Practices Enforcement: Is your Facility at Risk? (20)
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.
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.
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.
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.
𝘼𝙣𝙩𝙞𝙦𝙪𝙚 𝙋𝙡𝙖𝙨𝙩𝙞𝙘 𝙏𝙧𝙖𝙙𝙚𝙧𝙨 𝙞𝙨 𝙫𝙚𝙧𝙮 𝙛𝙖𝙢𝙤𝙪𝙨 𝙛𝙤𝙧 𝙢𝙖𝙣𝙪𝙛𝙖𝙘𝙩𝙪𝙧𝙞𝙣𝙜 𝙩𝙝𝙚𝙞𝙧 𝙥𝙧𝙤𝙙𝙪𝙘𝙩𝙨. 𝙒𝙚 𝙝𝙖𝙫𝙚 𝙖𝙡𝙡 𝙩𝙝𝙚 𝙥𝙡𝙖𝙨𝙩𝙞𝙘 𝙜𝙧𝙖𝙣𝙪𝙡𝙚𝙨 𝙪𝙨𝙚𝙙 𝙞𝙣 𝙖𝙪𝙩𝙤𝙢𝙤𝙩𝙞𝙫𝙚 𝙖𝙣𝙙 𝙖𝙪𝙩𝙤 𝙥𝙖𝙧𝙩𝙨 𝙖𝙣𝙙 𝙖𝙡𝙡 𝙩𝙝𝙚 𝙛𝙖𝙢𝙤𝙪𝙨 𝙘𝙤𝙢𝙥𝙖𝙣𝙞𝙚𝙨 𝙗𝙪𝙮 𝙩𝙝𝙚 𝙜𝙧𝙖𝙣𝙪𝙡𝙚𝙨 𝙛𝙧𝙤𝙢 𝙪𝙨.
Over the 10 years, we have gained a strong foothold in the market due to our range's high quality, competitive prices, and time-lined delivery schedules.
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.
"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.
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.
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Core technology of Hyundai Motor Group's EV platform 'E-GMP'Hyundai Motor Group
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Discover more about Hyundai Motor Group’s EV platform ‘E-GMP’!
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!
Digital Fleet Management - Why Your Business Need It?
Unfair and Deceptive Acts and Practices Enforcement: Is your Facility at Risk?
1. Unfair andUnfair and
Deceptive ActsDeceptive Acts
and Practicesand Practices
Enforcement: IsEnforcement: Is
your Facility atyour Facility at
Risk?Risk?
December 3, 2015
Presented by:
Ryan Lane
Director, KPA Sales & Finance Compliance
Jim Radogna
Senior Sales & Finance Compliance Specialist
3. KPA:KPA: A comprehensive solution for Environmental Health & Safety,
HR Management, and Sales & Finance Compliance.
Over 5,200 clients, including 8 out of 10 of the largest dealership groups in the
country, count on KPA for Environmental Health & Safety, HR Management and Sales
& Finance Compliance programs that save them time and save them money.
6. 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
7. Disclaimer
The material provided in this seminar 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.
8. What’s the Big Deal About UDAPs?
• UDAPs cover virtually EVERY aspect of your sales and finance
operations. Everything from advertising and marketing to consumers,
conversations your staff has with customers, conversations managers
have with salespeople, how deals are desked, how deals are handed off
to finance, how repair estimates are handled – you name it
• EVERYONE in the dealership who deals with the public is subject to
UDAP statutes and can create liability for the dealership and themselves
• UDAPs are extremely broad and provide both for enforcement by the
federal and state government and individual actions for damages brought
by consumers who are hurt by the practices.
• They are a favorite weapon for consumer attorneys that specialize in
suing dealers
• No customer complaints are necessary and even inadvertent violations
are actionable
• Interpretation & enforcement constantly evolving
9. The Players
Consumer Financial Protection Bureau (CFPB)?
Federal Trade Commission
•The nation’s top consumer cop that directly regulates dealers
•Very proactive lately - taking action without customer complaints
•But, too many businesses, not enough investigators so chances of getting caught slight
•Consent orders typical initial penalty but quick to impose monetary penalties
•Provides only FTC enforcement and not private enforcement
State Attorneys General
•Active in pursuing claims against dealers
•Can impose higher penalties than private actions - $13.5 million recently
•More reactive, respond to customer complaints
Plaintiffs’ Attorneys (“Auto Fraud Specialists”)
•Actively troll for business
•Have a number of tricks up their sleeves to turn little complaints into big problems
10. Applicable UDAP Statutes
• FTC Act – fraudulent, deceptive and unfair business
practices
• State UDAP Statutes - unfair, deceptive, and
unconscionable acts (some states have more than one
UDAP statute).
• State Rules on Vehicle Advertising
• Variety of other statutes (TILA, FCRA, ECOA, odometer
statutes, retail installment sales acts, fed or state RICO) –
violation may be per se UDAP violation
• Attorneys love to combine regulations for more remedies
and higher fees
11. Other Alternatives
• Federal law claims (TILA, etc.) can allow federal court
jurisdiction. A federal RICO can provide treble damages and
attorney fees. A state RICO claim may provide similar
remedies or punitive damages
• Potential additional counts to a UDAP case are claims of
common law fraud, breach of contract, breach of warranty, or
unjust enrichment. Common law fraud and other tort
remedies are important because they allow a punitive
damages claim
12. Remedies
FTC – Consent orders (typically 20 years), up to $16,000 per day per violation
State:
Private:
•Actual economic damages
•injunctive relief
•Rescission
•punitive damages
•class action
•attorney fees and costs
•treble damages in some states
Attorney General: injunction, license revocation, appointment of receiver; restitution;
civil penalties; costs.
The penalties can be enhanced if knowing/willful or the victim is older
13. Criminal Liability
• It’s a felony to make a knowing and willful
misrepresentation to a federally insured financial
institution
• Criminal charges have been brought against
dealership employees for falsifying credit
applications, grossly inflating trade-in values,
falsifying down payments, power booking, forgery,
and straw purchases
• Other charges for odometer violations, deceptive
interstate advertising, and payment packing
14. Punitive Damages
• Not insurable in many states (except vicarious)
• Some states cap amount of punitive damages,
some don’t
• Vicarious liability defense can be difficult if the
employer authorized or ratified the conduct or the
manner in which the particular task was
performed; or empowered the employee, i.e., by
making him or her a manager, lack of training, or
recklessly hired or retained an employee that was
unfit for the particular job.
15. Are UDAP Penalties Insurable?
Maybe not…
Dealer group denied coverage for lawsuit in which employees failed to disclose that the price
of an etch product was included in the amount of financing they obtained and that
employees told purchasers and lessees that they had to purchase etch in order to obtain
financing. The court stated “fraudulent misrepresentations and nondisclosures were done
intentionally with the full knowledge of and at the direction of the principals of the dealer
as a 'pattern and practice' of doing business."
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
16. Key Features of UDAP Statutes
• Failure to disclose material facts may be deceptive. Mere silence can be a UDAP
violation
• Most courts hold that the Parol Evidence Rule does not apply to UDAP claims
• UDAP claims can be founded on oral misrepresentations, the failure to disclose,
misleading pictures, and ambiguous statements that are technically accurate, but
deceptive as interpreted by the consumer.
• A dealer’s oral misrepresentations may violate a UDAP statute even if they are
subsequently corrected by a written disclosure statement.
•. In many cases, the consumer need not prove the seller’s intent or knowledge.
• The seller’s good faith is no defense.
• UDAP claims can be brought even if the car is sold “as is”
• Ambiguous statements, half-truths, and literally true statements can be
actionable
• 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 a salesman’s
misrepresentations
17. Key Features of UDAP Statutes
• A violation of an FTC rule or a state or federal statute meant to protect the public
may be a per se UDAP violation
• A seller’s good faith efforts do not prevent a practice from being deceptive under
the FTC Act. For example, it is not a defense that the seller acted in good faith
upon the advice of counsel
• Where there is a statutory defense for “bona fide error,” this defense applies only
to clerical errors, such as typographical errors or mistakes in computing numbers,
not to a seller’s other unintentional misrepresentations
• Often an advertisement or statement itself is sufficient proof of its deceptive
nature
• It is no defense to a deception claim under the FTC Act that the challenged
practice is engaged in throughout an industry or is “customary” business conduct
• Even if proper disclosures are made in writing, if a sales presentation effectively
obscures the meaning of those disclosures, the total representation is deceptive
• A practice is deceptive even if subsequently clarified. Point of sale disclosure is
not sufficient to clarify deceptive media advertising
18. UDAP Examples
• Making false statements or failing to disclose a material facts to a consumer
• Oral promises made to the customer that the dealer fails to deliver upon.
• Adding the cost of an F&I product to a consumer’s purchase agreement or lease without first
obtaining the consumer’s express consent to purchase the product.
• Informing or suggesting to a consumer that the price of any F&I product is included in the price of the
motor vehicle, when it is, in fact, not.
• Payment Packing
• Misleading statements about APR
• Misleading a consumer about the amount of incentives available
• Yo-yo financing
• Informing or suggesting to a consumer that the sale or lease of a vehicle subject to credit approval is
a final or completed transaction.
• Informing a buyer that financing for the car will not be approved unless the buyer purchases a service
contract, insurance or other products
• Informing or suggesting to a consumer that purchase of an F&I product will increase the likelihood
that the consumer will be approved or that financing will be approved on more favorable terms to the
consumer.
• Leading a consumer to believe that he or she is purchasing a vehicle when it is in fact a lease.
• Failing to disclose dealer-added accessories on advertised vehicles.
19. More UDAP Examples
• Leading a consumer to believe that the dealer will be assuming all liability under the lease of a trade-
in vehicle, when the dealer intends to only make the final lease payments and assume no other
liability, such as excess wear and tear or over-mileage.
• Hidden Finance Charges
• Failure to properly disclose negative equity
• “Power Booking”
• “Straw Purchase”
• Engaging in false or misleading advertising, either orally or by way of media.
• Selling a vehicle for more than the advertised price
• “Price-Gouging” or overcharging for finance and insurance products.
• Failure to disclose known vehicle history such as rental, salvage, lemon law buyback, etc.
• Misrepresenting a vehicle’s damage history
• Breach of warranty claims
• Representing that vehicles are new when they are in fact, used.
• Representing that a vehicle is of a particular standard, quality, or grade when it is not.
• Falsifying Credit Information
• Obtaining a credit bureau without proper authorization.
• Altering documents without the knowledge and permission of all parties.
• Forging documents.
20. More UDAP Examples
• Adding charges above advertised or agreed to prices
• “Five-finger close”
• Failure to give Adverse action Notices
• Including a down payment on the loan documents, but never recovering this down payment from the
consumer
• Making a side loan to the consumer to pay for the down payment
• Failure to pay off trade-ins in a timely fashion
• Lowering the Trade-In’s Agreed-Upon Price
• Failure to give the buyer a copy of the contract or provide a contract with blank spaces
• Failure to allow a customer the to leave with an unsigned copy of the retail installment contract
• Obtaining the consumer’s signature on a contract which does not accurately reflect the agreement
• Altering the sales or loan documents after consummation
• interfering with the buyer’s right to read the contract before signing
• Misrepresent the nature or import of documents being signed
• Selling a service contract without disclosing any additional fees that will be imposed if the consumer
makes a claim under the contract – for example, an inspection fee to determine if the repairs are
covered under the contract.
• Failure to disclose that a dealer fee is optional or misrepresenting that a fee is required by law
• Adding a fee after the final price has been negotiated
21. More UDAP Examples
• Posting false testimonials or online reviews
• Advertising vehicles with the intent not to sell them as advertised
• Misrepresenting a vehicle’s list price
• Improper vehicle repossession
• Failure to substantiate claims made
• Refusing to abide by an advertised promise to match competitors’ prices
• Deceptive quality claims as to used cars
• Disparage the merchandise, services, or business of another by false or misleading representations
• Falsely representing that offers are for a limited time only (for example, you must sign today)
• Failure to comply with offered or implied warranties
• Subsequently disclaim an oral warranty with an “as is” contract
• Fail to disclose that a vehicle has no warranty or to represent that the vehicle comes with a warranty
when it does not
• Negotiating a deposit check after promising not to do so
• Failing to credit a down payment to a sales contract
• Disclosing private information to a nonaffiliated third party without giving the consumer an
opportunity to opt out of the disclosure
• Misrepresentations that a price is low, competitive, or at book level when its not
22. More UDAP Examples
• Failure to safeguard customer information from wrongful access or use
• Misrepresenting the number of prior owners of a vehicle
• Fail to make available, prior to sale, the terms of any written warranty offered with the sale
• Failure to provide proper notice when a retail transaction is conducted in a language other than
English
• Failing to return a trade-in, or selling the trade-in, before the deal is consummated, or where dealer
cancels the sale
• Violation of FTC rules, including the Used Car Rule
• Attempting to coerce the consumer into accepting less favorable contract terms after committing to
the original terms
23. How Do Plaintiffs’ Attorneys Develop Cases?
• No matter what the customer’s initial complaint is (usually
dissatisfaction with vehicle), the attorney will comb through all sale
documents and sue using every law and legal theory that seems to fit,
including technical violations
• Their primary goal is to show violations as being willful, a systematic
and organized pattern of deceptive practices, or racketeering (RICO)
to rack up the big $$$ - punitive damages, class action
• Whatever type of problem the consumer client first discusses, the
attorneys explore potential UDAP violations in all aspects of the
transaction—advertising, sales presentations, consummation of the
sale, credit terms, and the seller’s performance (Santander)
• Plaintiffs’ attorneys are very savvy at coaching clients and analyzing
paperwork (e.g. write-ups) to win the “he said she said” battle
24. Best Practices to Avoid UDAP Traps
• Train ALL employees who deal with the public on
compliance including fixed ops
• Have Policies/Codes of Ethics in place
• Hold staff accountable through audits
• Good Faith Effort at Compliance
• Institute a complaint resolution process
• Utilize Arbitration Agreements – not bulletproof
but helpful. Also be aware that arbitration can
backfire ($335k, 1.3 million YouTube views)
26. Contact Information
The recorded webinar and presentation slides will be emailed to
you today including your local representative’s contact information.
www.kpaonline.com