Car Dealer Compliance Case Study


Total Dealer Compliance is an automotive compliance consulting and training firm. We work with auto dealers nationwide to ensure their business practices meet all state and federal regulations. Our aim is to instill a culture of compliance in our client dealers, train dealership staff and management, and help to eliminate the risk of potentially crippling fines and penalties.

Our Client & Challenge:

Total Dealer Compliance was engaged by a South Carolina auto dealership to audit current compliance standards and develop an action plan to improve compliance across all areas of business.

Our client was a successful and profitable dealership with a strong local reputation. Like most dealerships, our client’s management focus was on sales and customer acquisition. The auto retail industry today finds many dealerships, including our client, under tremendous pressure from manufacturers to meet sales objectives.

The overwhelming focus on sales causes compliance issues to be underemphasized. Our client’s goals and strategies were almost entirely focused on sales, with limited effort and understanding of compliance needs. Given this dealership’s high profitability, they understood they were becoming a target for regulators.

The Results:

TDC began with a complete compliance audit, covering all business areas from computer security, to sales practices, finance laws, and more. As we often do, we uncovered gaping holes in this dealership’s compliance programs.

Working with management and employees, we implemented a 10-step compliance program. This included critical components that regulators target first,

1. Written Safeguards Program.
2. Written Identity Theft Prevention Program.
3. Streamlined Privacy Notice, Adverse Action Notice, and Risk Based Pricing.
4. Instituted Fair Credit Program in the Finance Department.
5. Improved onboarding process and training of existing employees through online courses and certification.
6. Improved IT security protocols in order to protect non-public customer information.
7. Recommended creating an Emergency Action Plan and conduct regular drills.
8. Outlined duties and responsibilities of a Compliance Officer.
9. Recommended setting up a formal Complaint Resolution Process.
10. Recommended regular semi-annual training for all employees.

Beyond this initial strategy, TDC will also complete quarterly compliance audits to ensure that best-practices are being observed and to keep our client updated with any changes in compliance rules.

Ultimately our client went from severe compliance risk, to complete compliance across all key regulations and business areas. This dealership has understood that while the traditional focus on sales is key to revenue generation, implementing a compliance plan is a critical path to revenue preservation.

Does your auto dealership have a compliance strategy in place? Most dealers will find themselves in the same position as our client above, with a heavy focus on sales, but almost no plan for protecting revenue from compliance penalties. Reduce your compliance risk today - contact TDC for a free compliance strategy proposal