Making Sense Of The FTC’s New Used Car Rule (Webinar)
In December, dealerships were preparing for changes to the New Used Car Rule regarding the New Buyers Guide. In January, those changes went into effect. It is now March, so how well did you prepare? Will you pass muster? On March 28th Hudson Cook attorneys Catharine Andricos, Lauren Hunt, and Chris Capurso will be discussing some of the challenges dealerships have faced with this change and how those challenges can be addressed.
A little history on The Used Car Rule
The Used Car Rule was introduced in 1984 with the primary aim to curb unfair and deceptive practices, particularly in the warranty coverage area and to stop used car dealers from making oral misrepresentations and unfair omissions of material facts to consumers. The Used Car Rule applies in all states except Maine and Wisconsin. These two states are exempt because they have similar regulations that require dealers to post disclosures on used vehicles.
In June 2016, the FTC announced it would increase the maximum penalties per violation from $16,000 to $40,000 starting August 1st. This increase more than doubled the maximum civil penalties it could seek against violators.
An overview of the changes to The Used Car Rule
- Placing boxes in the Buyers Guide that dealers can check to show whether a vehicle is covered by a third-party warranty and whether a service contract may be available
- Providing a box dealers can check to show that an unexpired manufacturer’s warranty applies
- Adding air bags and catalytic converters to the Buyers Guide’s list of major defects that may occur in used vehicles
- Adding statements that direct consumers to obtain a vehicle history report, to check for open recalls,to visit ftc.gov/usedcars for information on how to obtain a vehicle history report, and to visit www.safercar.gov to check for open safety recalls
- Adding a statement, in Spanish, to the Englishlanguage Buyers Guide, advising Spanish speaking consumers to ask for the Buyers Guide in Spanish if the dealer conducts the sale in Spanish
- Providing a Spanish translation of the statement that dealers may use to obtain a consumer’s acknowledgement of receipt of the Buyers Guide
- Changing the description of an “As Is” sale
If you have lingering questions about these new changes be sure to sign up for the webinar on March 28th so that you can ensure compliant status.
