Transcript Raising the Compliance Hurdle, Lowering Your Litigation

East Coast NABD BHPH Conference
November 3-5, 2013
New Orleans, LA
Ask the Counselors
Terrence J. O’Loughlin, J.D., M.B.A. ([email protected])
David Bafumo, Esquire ([email protected])
Thomas B. Hudson, Esquire ([email protected])
Ten Things You’re
Probably Doing Wrong
Thomas B. Hudson, Esquire
Using a Buyer’s Order
that violates federal law
Not having a fair credit
policy
Using an application form
that doesn’t comply with
the ECOA and Reg. B
Not sending adverse action
notices when required
Not using an arbitration
agreement
Not having your F&I
personnel trained
Not having a named
privacy officer, red flags
officer and compliance
officer
Financing repairs
incorrectly
Not having a legal review
of your advertising
Using “side notes” or
employing “pick-up
payments” incorrectly
Is the CFPB interested in you?
How is your industry typically viewed
by consumer rights groups?
A Few Others…
Specific BHPH Issues
 Advertising financing for all
comers and then turn a consumer
down
 Using the same salesmen to sell
the same cars at very different
prices – hidden finance charges
 Requiring after-market products
in order to qualify a consumer for
financing
Specific BHPH Issues
 Violating the credit repair act by
advertising that you are a “credit
rebuilder”
• May trigger 3 day right to cancel
 Failure to post sales price
 Using revolving repossession
schemes
 Failure to observe the used car rule
Add-On Product
Compliance
For VSC/Extended Warranty,
GAP and Other Loan Add-Ons
David Bafumo, Esquire
Product and Provider Due
Diligence
Product Transparency:
Benefits & Limitations
Explaining Consumer Cost
Disclosure Forms
Product Sales Presentations
Product Provider/Administrator
Marketing Materials
Dealership Purpose & Policies
Product Management
Monitoring Product Performance
Providing Customer Assistance
Handling Customer Complaints
Resources
 “Understanding Vehicle Finance” (NADA
Publication)
 NADA Privacy Safeguarding Management
Guide
 State ADAs and IADAs
 State government websites
 CARLAW® F&I Legal Desk Book
 CARLAW® Red Flags Rule Compliance
Guide
Resources (Continued)
 CARLAW® Risk-Based Pricing Compliance
Guide
 CARLAW® Service Members Civil Relief
Act Compliance Manual
 Spot Delivery®
 Trainers and Consultants
 Service Providers
 FTC website
Contact Information
Terrence J. O'Loughlin, J.D., M.B.A.
Director of Compliance
Reynolds & Reynolds
7201 NW 80th Street
Tamarac, FL 33321
Phone: 954-718-9266
[email protected]
Thomas B. Hudson, Esq.
Senior Partner
Hudson Cook, LLP
7250 Parkway Drive
5th Floor
Hanover, MD 21076-1343
Phone: 410-865-5411
[email protected]
David Bafumo, Esq.
President
FNI Incorporated
2474 Walnut Street, Suite 281
Cary, NC 27518
Phone: 919-349-4901
[email protected]
Questions?