04
December
2025

We've Got Some Work To Do

Discover why staying ahead of dealership regulations is more urgent than ever. Learn how proactive compliance and industry engagement can protect your business from growing risks.

We've Got Some Work To Do

I just wrapped up my “conference season” for the year, having attended the FIADA and MidAtlantic Conventions. Putting aside the travel, costs and other logistical challenges, I enjoy heading to these shows and catching up with clients and friends. I also get a lot of benefit from meeting dealers that I’ve never met and that don’t have familiarity with me. I work in a bit of an echochamber, hearing pretty regularly from a good number of clients with whom I have a long history, so these events are a good opportunity to get outside of that environment and learn from a new set of people.

My Take-Aways
My travels gave me a renewed perspective of both what is and isn’t on dealers’ minds when it comes to compliance and the regulatory, legal and litigation environments in which we operate. I’d like to share some of my observations:

First, the recent Tricolor and Primalend bankruptcy filings have certainly added to the stress level of those dealers that use outside capital. A number of folks approached me with concern about increased scrutiny from their lenders, both from a performance perspective and regarding questions about what controls are in place in the business. That’s where a strong compliance management system and written policies and procedures come into play. I just published an article on this very subject (Don’t Let Your Money get Spooked - Google it if you are interested) so I won’t repeat myself here, but I’ll summarize by saying it's vital for dealers to understand where the likely risks are in their business and address them before their lender or capital provider asks.

I recently worked with a dealer in the Northeast that was getting a new credit line. The lender provided this dealer with a list of items it wanted to see implemented before their capital request would be approved. From a quick glance at the list, it was apparent to me that the lender was well aware of recent regulatory and litigation activity in the state and wanted this dealer to prove it had coverage in these areas. All was well in the end, but precious time was lost creating and implementing vital content that really should have been in place beforehand.

Secondly, several dealers approached me with questions about pricing and advertising. It seems these are two areas where there is a lot of confusion and all it took was mentioning these topics during my presentations to generate deeper interest. I’ve got a bottom line saying: “the price is the price is the price”. What I mean is that there’s no such thing as an “internet price”, it’s not a good idea to require folks to print out a “coupon” to get the price being advertised, and the price listed on the website and window sticker should be the same. If any other costs or expenses are required to be paid for the buyer to drive away, those should either be included in the price, or be listed in close proximity to the advertised price, and I strongly suggest these be itemized. There’s limits to the detail I can provide in this article, so just ask if you’d like a deeper dive into this subject.

Sometimes, I get pushback to this guidance. Dealers tell me that doing this would put them at a competitive disadvantage to their competitors, who advertise a lowball price and aren’t following these rules. While I’m sympathetic to this challenge, it doesn’t change the correct answer. It’s up to each dealer to determine where they want to be on the risk spectrum and part of my job is to make sure they have all of the information needed to understand the true risks involved. The FTC and several state regulators have been aggressively pursuing dealers for violations in this area.

Lastly, some of my conversations reminded me that dealers have a dangerous tendency to grab onto the “next big thing” that they believe will help drive leads and sales without properly vetting the service or the provider. This isn’t a new phenomenon, it seems like every year there is a new spin on a product that promises untold riches. In one of the recent presentations, a dealer was sharing the great success of a recent marketing initiative without presenting any downside risk. During the Q&A session, an attorney in attendance shared a story about a high six figure settlement in a litigation matter involving a similar initiative and warned of the importance of having qualified experts analyze the use of new technology or products in order to reduce risk.

What Really Scares Me
Congratulations to the dealers that invest the time and expense in their businesses and attend these events. Getting away from the office or store is never easy, and those that do show a level of commitment and desire to get better. I was truly disappointed by the level of attendance at these events, though, and it does seem to me that it’s getting more difficult to get dealers to participate with their state associations, which are the best source of information about the “heartbeat” issues impacting any given state.

What about the vast number of dealers that don’t attend these events and that don’t participate in the industry at their state, local or any level for that matter. Where do they get the information needed to stay a step ahead of trouble? How do they stay up to speed? Are they doing anything to identify risk and protect their business? They don’t attend these events. Do they even read publications like this? Do they speak with other dealers, or do they operate in a vacuum? It pains me to admit that I think there is a significant correlation between that group and the dealers that step over the line and draw regulatory and legal scrutiny and make things harder for the rest of the industry. Like the title of this article indicates, we’ve certainly got some work to do.

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Categories: Dealer News Stories

Steve Levine

Steve Levine

Steve Levine is an auto finance lawyer with over 30 years of experience protecting car dealers and finance companies. He is an owner and Chief Legal and Compliance Officer of Ignite Consulting Partners, which offers guidance on compliance, operations and best practices. He has also published two books, Winning the Fight: A Guide to Protect Car Dealers and Counterpunch: Compliance Strategies for Car Dealers which are both available on Amazon. Or contact info@IgniteCP.com to learn more. Please follow Steve on X @LawyerLevine for compliance and industry related content.

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