Author Archive

Do-not-Call Implementation Act

Public Law 108–10 108th Congress

An Act
To authorize the Federal Trade Commission to collect fees for the implementation
and enforcement of a ”do-not-call” registry, and for other purposes.

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,


This Act may be cited as the ”Do-Not-Call Implementation


The Federal Trade Commission may promulgate regulations
establishing fees sufficient to implement and enforce the provisions
relating to the ”do-not-call” registry of the Telemarketing Sales
Rule (16 CFR 310.4(b)(1)(iii)), promulgated under the Telemarketing
and Consumer Fraud and Abuse Prevention Act (15 U.S.C. 6101
et seq.). Such regulations shall be promulgated in accordance with section 553 of title 5, United States Code. Fees may be collected
pursuant to this section for fiscal years 2003 through 2007, and shall be deposited and

credited as offsetting collections to the
account, Federal Trade Commission—Salaries and Expenses, and
shall remain available until expended. No amounts shall be collected
as fees pursuant to this section for such fiscal years except to
the extent provided in advance in appropriations Acts. Such
amounts shall be available for expenditure only to offset the costs
of activities and services related to the implementation and enforcement
of the Telemarketing Sales Rule, and other activities resulting
from such implementation and enforcement.


Not later than 180 days after the date of enactment of this
Act, the Federal Communications Commission shall issue a final
rule pursuant to the rulemaking proceeding that it began on September
18, 2002, under the Telephone Consumer Protection Act (47 U.S.C. 227 et seq.). In issuing such rule, the Federal Communications
Commission shall consult and coordinate with the Federal
Trade Commission to maximize consistency with the rule promulgated
by the Federal Trade Commission (16 CFR 310.4(b)).


Within 45 days
after the promulgation of a final rule by the Federal Communications
Commission as required by section 3,

the Federal Trade Commission and the Federal Communications Commission shall
each transmit to the Committee on Energy and Commerce of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate a report which shall include— (1) an analysis of the telemarketing rules promulgated
by both the Federal Trade Commission and the Federal
Communications Commission;
(2) any inconsistencies between the rules promulgated by
each such Commission and the effect of any such inconsistencies
on consumers, and persons paying for access to the registry;
(3) proposals to remedy any such inconsistencies

For each of fiscal years 2003 through
2007, the Federal Trade Commission and the Federal Communications
Commission shall each transmit an annual report to the
Committee on Energy and Commerce of the House of Representatives
and the Committee on Commerce, Science, and Transportation
of the Senate a report which shall include—
(1) an analysis of the effectiveness of the ”do-not-call” registry
as a national registry;
(2) the number of consumers who have placed their telephone
numbers on the registry;
(3) the number of persons paying fees for access to the
registry and the amount of such fees;
(4) an analysis of the progress of coordinating the operation
and enforcement of the ”do-not-call” registry with similar registries
established and maintained by the various States;

(5) an analysis of the progress of coordinating the operation
and enforcement of the ”do-not-call” registry with the enforcement activities of the Federal Communications Commission
pursuant to the Telephone Consumer Protection Act (47 U.S.C.
227 et seq.); and
(6) a review of the enforcement proceedings under the
Telemarketing Sales Rule (16 CFR 310), in the case of the
Federal Trade Commission, and under the Telephone Consumer
Protection Act (47 U.S.C. 227 et seq.), in the case of the Federal
Communications Commission.

Approved March 11, 2003.

Customer Perceptions Through the BHPH Purchase Process

Customer Perceptions Through the BHPH Purchase Process

There is a growing need to help guide the customer through a series of psychological steps in the Buy Here-Pay Here Customer Purchase Process in today’s market. The in-house financing business has gotten more complicated during the last few years.

With many “subprime” finance companies going out of business after 2008, many customers have landed into the BHPH market without knowing it. Before the financial crisis of 2008, a new car customer who had some challenges with their credit would have to accept that they could go from 2.9% financing to 12.9% financing, but still be able to purchase a new car through a subprime finance source. They also could go to a retail used car store and purchase a near new vehicle through that same subprime finance source.

But with the subprime market virtually going away, we now have a customer who purchased a new vehicle three years ago, who acquired poor credit through the financial crisis, who doesn’t know until they go to a new car store that they not only can not get approved for a new car, but their only option is to go to a buy here-pay here dealer.

Because most customers from this new car sector may perceive BHPH dealerships as a poorly trained sales team, with a poor

facility and poor quality cars, these customers are in the first stage of Perception:

Denial: We have to help the previous new car customer through the Denial stage by being professional, by-pass new car concerns (Price, Discount, Trade Value, etc.), build value in your approval process through the Why Buy book and Application.

Reality: Once the customer is brought through this initial step, they will begin to see that the most important thing in the purchase process is getting the most favorable approval based on their current credit situation, while fitting into their budget. They then see that getting a good quality vehicle that has been through a multi-point inspection, comes with a warranty and also comes with a CARFAX report, is second to the credit approval.

Acceptance: Once the Underwriter or Branch Manager has selected the vehicles that the customer qualifies for, the Loan Specialist needs to manage this next step in the customer’s perception that the vehicle they select is “good enough.” This can only happen during the Test Drive. Unlike a Test Drive in the new car retail selling process that focuses on Features, Advantages and Benefits and may last 20 minutes to sell the value on the car, the BHPH Test Drive is designed to give the customer the time to “Accept” that this vehicle is “good enough” and making payments on time for the next 18 months to re-establish credit is the most important factor in their purchase


Appreciation: If we have done our job right, the customer’s perception will be turned from nervous and demanding to “Appreciation.” If the Loan Specialist has not accomplished this, the customer will become very difficult over the life of the loan and possible collection nightmare. If the customer is thanking you after the delivery paperwork, you have done your job!

How to define what type of customer you have:

** Retail Customer Concerns: Price, Discount, Trade Value

** BHPH Customer Concerns: Get me approved, Down Payment, Previous Credit

One-on-One: Training Your Team Effectively

One-On-One: Training Your Team Effectively

Purpose: Now that the economy is coming back, we need to make the time to get back to developing our team. Having daily 1 on 1’s with every employee is the most important thing you can do in a dealership.

Having daily 1 on 1’s with a producer (Salesperson, Business Development Specialist, Service Advisor, Collector, Team Leader or anyone that deals directly with customers every day) is even more important because no other position in the dealership faces more daily rejection and can increase profits directly with a great performance. A daily 1-on-1 coaching session will give the coach (sales team leader, collection team leader & service team leader) a chance to build rapport, build the producer’s confidence, motivate, review working activities and develop skills every day.

Training, tracking, goal setting, procedures and policies and motivation are all directly influenced in a daily 1 on 1. Having a good 30 minute training meeting with your team is very important but not as important as a 1 on 1. This holds true at home. Eating dinner together as a family is important, but not as important as 1 on 1 time with your children and your spouse.

Implementation: The first step is to make sure you have written procedures on exactly what and how you want your staff to do

their job. Then you have to have initial and ongoing group and 1 on 1 training to keep their skills up. Since the daily 1 on 1 will have the biggest impact on performance and profits in a department (same if you don’t do them), then we need to prioritize them by scheduling them at the beginning of every finance specialist’s shift. Everyone makes excuses why they don’t do “group” training because the manager is too busy, but there is no excuse for skipping a daily 10-15 minute 1 on 1. Our team will not learn on their own, they need a coach to guide them step by step so they can get better each and every day (the same way a child will not learn in school by themselves without the teacher / coach spending time with them). Rule 1, just like all training it needs to be interesting, informative and valuable to your team. Don’t think of it as a grind session. That’s called a counseling session.

How: Review what you want to cover in your 1 on 1 before you sit down with each individual team member. Pull up their working prospects or accounts in your CRM. Don’t just ask, “What do you have going on?” Review daily work plan and review a recent touch customer. Use this situation to train on a specific skill. You need to demonstrate the technique (practice or call customer to show them how to do it! Then have them demonstrate technique.

  • You are selling yourself just like a customer (1st Impression, Greeting, Build rapport and Investigate for their needs).
  • Get out your Daily 1 on 1 log so you can review the notes and homework from yesterday’s 1 on 1 along with the key points to review today.

  • 1st Impression – Make sure you are on time and free of distractions (turn off your cell phone! Just as we would want a finance specialist’s to do with customer).
  • Greeting – Smile and shake their hand (even if you’re having a bad day, your body language is 55% of your influence. Sit down on same side of a table or desk as your team member.
  • Rapport – 71% of people will do what you want them to do if they like you. Ask a couple “open-ended” questions to get them talking, “How was last night?” or “What did you do on your day off?” If you hear that they have a personal problem that is affecting them (you are their coach, not their marriage counselor. If you feel that this issue will affect their performance today, then get with your supervisor and decide to give them a day off to get things handled). If you’re not discussing or practicing skill development, it’s not an effective 1 on 1.
  • Investigate their biggest challenge when it comes to Customer situations. This will describe the need to work on: customer follow-up, Down Payment Techniques, Vehicle Selection techniques, Worksheet presentation, Prospecting, etc. Have your planner, tracking reports and CRM screen open in front of you so you can be prepared.
  • Presentation / Demonstration – (Why Buy Book, Worksheet & Vehicle) This is where you identify an area of improvement, discuss why ($$$) they need to improve on that skill, and then demonstrate to them how to do it.
  • Best ways to start almost every sentence or follow up when team member says something is with “why do you say that’ or just “why” – it’s “ask why 3 times” to get to the bottom of the problem and it works.

  • Your team member will notice if you say, why, why, why, why, why all the time…so alter with “because.” and just leave the sentence hanging – every finance specialist I know that’s any good will fill in the blanks for you. Example- Team Member- “I didn’t call Mr. Jones.” you “because..?.” And they’ll say, “Well, because I got too busy, etc.” Then try the 1-step – repeat back! “You got too busy?” It works great, they’ll tell you everything or you’ll at least uncover what they didn’t do.
  • Keep your focus on ACTIVITIES not % penetration. You can’t fake volume; you can cheat your way into a %!.
  • End on a positive after the review – good job on something they admitted, brought up, suggested..
  • All 1×1’s are confidential – and believe me, they’ll find out if you tell another team mate or gossip to manager what they told you, then you’re done – they won’t trust you again..
  • Never talk negatively about another employee or manager during a 1 on 1..

Remember, your Team Members, like our children, need your coaching and guidance for their careers like they need oxygen.

Conclusion: The best part of the Used Vehicle business is almost of your success will come down to the choices we make everyday. I hope you make the choice to invest in your team, and training for your people on how to effectively Persuade, Influence and Close customers.

Changing Culture: A New Look at Recruiting

Changing Culture: A New Look at Recruiting

We have many challenges to deal with in the BHPH business such as: Competition from new car dealers, increase in inventory costs, decrease in capital sources, licensing requirements from our state laws, compliance requirements, etc. One of the hardest things to deal with though is the challenge of how to manage, grow and develop our two most important assets; 1. Our employees and 2. Our Customer Base (Portfolio).

I work with dealers and general managers on how to recognize talent within their organization, how to put the best talent in the right position, how to develop their skills in every department and how to eliminate the biggest de-motivators that leads to turnover. The only way to create a positive change is to have an ongoing recruiting program. An owner should never have to feel like they have to keep a negative person because you need a “warm body” for floor coverage or never have to feel held hostage by a negative “top producer.”

Recruiting should be the same philosophy as our approach to generating applications or customer leads. We don’t advertise or

market ourselves only when it is slow or when we run out of customers on a slow day. We always need a consistent advertising and marketing message that not only builds your dealership brand, but has direct “call to action” ads that lead to an Internet, phone or showroom opportunity. You should always be recruiting good people with good character, good habits (follow-up and prospecting) and good skills (phone and customer relationship development).

The good news about a down economy is there are great people looking for a new career that would never consider working in our industry two years ago (similar to our current new customers to us who bought a new car three years ago but now have tough credit).

This is a great opportunity to hire someone who has experience with customer service, developing a customer base, networking, prospecting, following up every customer lead and actually doing something productive almost every day! You won’t normally find these candidates from former new car dealerships (maybe 5 percent but they already have jobs), but you will find them from industries such as: investments, insurance, real estate, mortgage, rent-a-center, pay day loans, etc. There are many industries that have the needed skills that we seek without having to unlearn a customer purchase process that is OPPOSITE (new car sales) of the BHPH sales process.

I have run ad’s with success in Craigslist and received many

qualified leads for the following positions just by listing “CUSTOMER SERVICE” and not running a traditional dealership advertisement such as “SALES PERSON,” top compensation, demo, etc.

(**Compensation listed below will vary and will be in line with each region. Just remember, “You get what you pay for.”)

Branch Positions:

Sales Assistant – $10-12 per hour to do receptionist / verifier and other administration duties to support sales / underwriting department.:

Branch Assistant – $12-$17 per hour (depending previous pay). They do all the Administrative functions and tracking that a Sales Manager would do along with Daily 1 on 1 with Salespeople to review current appointments. They also confirm appointments, handle incoming phone calls, and communicate with Sr. Underwriter.:

Customer Service Rep – $25k-$40k per year (depending previous pay) to do the same functions of a Salesperson EXCEPT for Closing T.O situations (Down Payment Bump, Closing on Vehicle Selection, Closing on Worksheet Payment). These take much greater skill.

Sales Person / Credit Specialist – $35k-$60k+ All have same pay

plan, draw may be higher based on past performance, but they are expected to bring every customer through the whole sales process and follow-up their own customer base. A salesperson should be able to T.O other customers to close on down payment, Vehicle Selection and Worksheet (payment terms).

Team Leader – $40k-$70k+ Same pay plan as salespeople, draw may be higher base on past performance. Bonus for helping new Salespeople hit higher level by daily 1 on 1 coaching and Closing their customers. They are NOT managers; they maintain their own customer base and provide the daily 1 on 1 training that a sales manager would do. Depending on the structure of multiple locations, a team leader could also make underwriting decisions based on minimum underwriting criteria determined by collections manager and dealer.

Collector – $25k – $40k per year (depending previous pay). They would manage accounts for the finance company and develop an increased share of the portfolio.

For many owners, this is a whole philosophy and culture shift when moving towards this recruiting path. Just remember, “If you keep doing things the same way, you will keep getting the same results.” The football analogy would be, “we are not looking for a specific position player that would make us miss the most talented player available.” Hiring talent and character first (that doesn’t have bad habits from another dealership) is a step for a lot of dealers. Just like we want as many applications as possible

(400) even though we may limit the amount of money we lend each month (75). We know that by looking at 400 apps is always better than 100 if we want to lend 75. Another key to recruiting, is we also need to eliminate any words or things that would have a potential candidate “pre-qualify” our opportunity and dismiss it because they don’t understand who we are, what we do and that we are in the business of providing loans and not selling cars.

Steps to creating a successful ongoing recruiting program: 1. Create the momentum by generating good candidate resumes. 2. Phone interview the qualified candidates to weed out the ones we don’t want but also coordinate the in-person interviews to determine if this potential candidate will represent our organization for the future. You also need to create excitement in the opportunity to work for you. 3) Have a dynamic initial and ongoing training program for their position. 4) Have your training partner continue to support your team by being available for monthly, quarterly in dealership training along with ongoing video conference calls to discuss any organization issue. This will eliminate employee turnover and demotivation.

I look forward to working together on improving your team, growing your customer base and increasing net profits. Please don’t hesitate to call me if you have any questions.

FTC Announce Sweep Against 10 Auto Dealers

FTC Announces Sweep Against 10 Auto Dealers

‘Operation Steer Clear’ Drives Home That Auto Ads Must Be Truthful

The Federal Trade Commission announced today that nine auto dealers agreed to settle deceptive advertising charges, and the agency is taking action against a 10th dealer, in a nationwide sweep focusing on the sale, financing, and leasing of motor vehicles.

According to the complaints, the dealers made a variety of misrepresentations in print, Internet, and video advertisements that violated the FTC Act, falsely leading consumers to believe they could purchase vehicles for low prices, finance vehicles with low monthly payments, and/or make no upfront payment to lease vehicles. One dealer even misrepresented that consumers had won prizes they could collect at the dealership.

“Buying or leasing a car is a big deal, and car ads are an important source of information for serious shoppers,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “Dealers’ ads need to spell out costs and other important terms customers can count on. If they don’t, dealers can count on the FTC to take action.”

‘Operation Steer Clear’ is the latest effort from the FTC to protect consumers in the auto marketplace. The dealerships that settled are charged as follows:


Casino Auto Sales of La Puente, Calif., and Rainbow Auto Sales, of South Gate, Calif., allegedly violated the FTC Act by deceptively advertising that consumers could purchase vehicles at specific low prices when, in fact, the price was $5,000 higher. Both dealers’ ads involved a mix of English and Spanish. Honda of Hollywood, Los Angeles, and Norm Reeves Honda of Cerritos, Calif., violated the FTC Act by deceptively advertising that consumers could pay $0 up-front to lease a vehicle when, in fact, the advertised amounts excluded substantial fees and other amounts. The ads also allegedly violated the Consumer Leasing Act (CLA) and Regulation M, by failing to disclose certain lease related terms. Norm Reeves Honda’s ads also allegedly violated the Truth in Lending Act (TILA) and Regulation Z, by failing to disclose certain credit related terms.


Nissan of South Atlanta of Morrow, Ga., allegedly violated the FTC Act by deceptively advertising that consumers could finance a vehicle purchase with low monthly payments when, in fact, the payments were temporary “teasers” after which consumers

would owe a different amount. The ads also allegedly violated TILA and Regulation Z, by failing to disclose certain credit related terms.


Infiniti of Clarendon Hills of Clarendon Hills, Ill., allegedly violated the FTC Act by deceptively advertising that consumers could pay $0 up-front to lease a vehicle when, in fact, the advertised amounts excluded substantial fees and other amounts. The ads also allegedly violated the CLA and Regulation M, by failing to disclose certain lease related terms.

North Carolina

Paramount Kia of Hickory, N.C., allegedly violated the FTC Act by deceptively advertising that consumers could finance a purchase with low monthly payments when, in fact, the payments were temporary “teasers” after which the consumer would owe a much higher amount, by several hundred dollars. The ads also allegedly violated the TILA and Regulation Z, by failing to clearly and conspicuously disclose certain credit related terms


Fowlerville Ford of Fowlerville, Mich., allegedly violated the FTC

Act by sending mailers that deceptively claimed consumers had won a sweepstakes prize, when, in fact, they had not. Some of their ads also allegedly violated TILA and Regulation Z, by failing to disclose certain credit related terms.


Southwest Kia companies, including New World Auto Imports, Dallas, Texas, New World Auto Imports of Rockwall, Rockwall, Texas, and Hampton Two Auto Corporations, Mesquite, Texas, allegedly violated the FTC Act by deceptively advertising that consumers could purchase a vehicle for specific low monthly payments when, in fact, consumers would owe a final balloon payment of over $10,000. The companies also allegedly deceptively advertised that consumers could drive home a vehicle for specific low up-front amounts and low monthly payments when, in fact, the deal was a lease and they would owe substantially more up-front. The ads also allegedly violated the CLA and Regulation M, by failing to disclose certain lease related terms, and the TILA and Regulation Z, by failing to disclose certain credit related terms.

The proposed consent orders settling the FTC’s charges in the nine cases are designed to prevent the dealerships from engaging in similar deceptive advertising practices in the future. The orders prohibit the dealerships from misrepresenting in any advertisement for the purchase, financing, or leasing of motor vehicles the cost of leasing a vehicle, the cost of purchasing a

vehicle with financing, or any other material fact about the price, sale, financing, or leasing of a vehicle. When relevant, the proposed consent orders also address the alleged TILA and CLA violations by requiring the dealerships to clearly and conspicuously disclose terms required by these credit and lease laws. In the case where the dealerships misrepresented that consumers had won a prize, the proposed order also prohibits misrepresenting material terms of any prize, sweepstakes, giveaway, or other incentive.

The FTC would like to thank the Los Angeles Department of Consumer Affairs for its assistance with multiple investigations in California, and the Michigan Department of Attorney General for its assistance with the investigation in Michigan.

The Commission votes to accept the packages containing the nine proposed consent orders and complaints for public comment were 4-0. The agreements will be subject to public comment for 30 days, beginning today and continuing through Feb. 10, 2014, after which the Commission will decide whether to make the proposed consent orders final. Submit a comment electronically:

  • Casino Auto Sales
  • Honda of Hollywood
  • Fowlerville Ford
  • Infiniti of Clarendon Hills
  • Nissan of South Atlanta
  • Norm Reeves Honda Superstore
  • Paramount Kia
  • Rainbow Auto Sales
  • Southwest Kia

Comments in paper form should be mailed or delivered to: Federal Trade Commission, Office of the Secretary, Room H-113 (Annex D), 600 Pennsylvania Avenue, N.W., Washington, DC 20580.

In addition, the FTC issued an administrative complaint against Courtesy Auto Group of Attleboro, Mass. The FTC alleges the dealership violated the FTC Act by deceptively advertising that consumers can lease a vehicle for $0 down and specific monthly payments when, in fact, the advertised amounts exclude substantial fees. The ads also allegedly violate the CLA and Regulation M, by failing to disclose or clearly and conspicuously disclose certain lease related terms.

The Commission vote to issue the administrative complaint was 4-0.

Consumers in the market for a new or used vehicle should read the FTC’s Are Car Ads Taking You for a Ride? and Buying and Owning a Car.

NOTE: The Commission files a complaint when it has “reason to believe” that the law has been or is being violated and it appears to the Commission that a proceeding is in the public interest.

The issuance of the administrative complaint marks the beginning of a proceeding in which the allegations will be tried in a formal hearing before an administrative law judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics.

4 Social Media Legal Issues Dealers Cant Afford to Ignore

4 Social Media Legal Issues Dealers Can’t Afford to Ignore

It was bound to happen. The tremendous growth of digital marketing and social media was an invitation for government regulation. For
instance, the Federal Trade Commission recently updated its truth-in-advertising guidelines, which were last revised in 1980, to address the
commercialism of the Web. Federal and state regulators are taking the position that social media is not a loop-hole for deceptive marketing
practices and are actively enforcing and cracking down on social media deception. Proper social media ethics are now a matter of law, not
just personal preference.

Faking Reviews

The FTC’s updated Endorsement and Advertising Guidelines require companies to ensure that their posts are completely accurate and not misleading, and planting or allowing fake reviews is a violation. The Guidelines are extremely broad and can apply to anyone writing reviews on rating sites, web sites or promoting products through social media sites, including blogs.

There are several companies out there that offer seemingly quick and easy ways to improve your ratings on review sites. Be careful! A
Dealership in Texas suffered devastating reputation damage because of the review-posting practices of a company

they hired. A customer
discovered that suspicious “reviewers” were writing 5-star reviews about all kinds of businesses and dealerships across the nation on the same day. This debacle was uncovered in October of 2010, yet news stories continue to show up on the dealer’s page one search results.

There are several companies out there that offer seemingly quick and easy ways to improve your ratings on review sites. Be careful! A Dealership in Texas suffered devastating reputation damage because of the review-posting practices of a company they hired. A customer discovered that suspicious “reviewers” were writing 5-star reviews about all kinds of businesses and dealerships across the nation on the same day. This debacle was uncovered in October of 2010, yet news stories continue to show up on the dealer’s page one search results.

While the above case may be an example of a dealer who unfortunately hired the wrong vendor, an area of real concern is the activity of
a company’s own employees. The FTC recently charged a California marketing company with deceptive advertising after it found that the
company’s employees were posing as ordinary consumers posting positive reviews online.

Dealers may face liability if employees use social media to comment on their employer’s services or products without disclosing the
employment relationship. The FTC requires the disclosure of all “material connections” between a reviewer and the company that is being

These connections can be any relationship between a reviewer and the company that could affect the credibility a consumer
gives to that reviewer’s statements, such as an employment or business relationship. So if employees, friends, family or vendors post
reviews to prop up a dealership’s online reputation, they must clearly disclose any relationship they have with the company. In addition, all
reviews must be an honest opinion based on a real experience. Reviewers must never endorse a product or service that they have not used
personally or create any other form of false endorsement. It’s all about transparency and full disclosure.

Besides the obvious potential damage to a dealer’s reputation, failure to follow these regulations can result in substantial penalties. In recent
actions, the New York Attorney General fined a cosmetic surgery company $300,000 for ordering its employees to write fake reviews of its
face-lift procedure and the FTC ordered a company marketing instructional DVDs to pay $250,000 for fake reviews posted by the company’s
affiliate marketers. The FTC has indicated that companies are fully responsible and liable for all inappropriate actions of their employees,
their vendors, and any advocates they recruit. Reviewers may also be held personally liable for statements made in the course of their

Paying for Reviews

The practice of offering a free oil change or gas card

to a customer in exchange for a good survey has long been frowned upon by
manufacturers. Because there are no factory gatekeepers when it comes to online ratings, it may seem tempting to offer customers an
incentive to post a positive review. The good news is that you can if you want to; the not-so-good news is that the regulations require that
any reviewer provided with any form of compensation such as free services, rewards, incentives, promotional items, gifts, samples, or review
items, must fully disclose the source and nature of any compensation received.

So, if you pay for reviews and the reviewers fail to disclose their compensation, you may face liability. This is an area where it’s easy to get
caught and besides the legal danger, your reputation will likely take a big hit.

Advertising on Social Media Sites

The wisdom of trying to “sell” on social media sites by posting inventory, prices, or payments is an ongoing debate, but the fact remains that
many dealers are engaged in this activity in some form. While I have no opinion on the relative merits of whether to “sell or not to sell” on
social media, it’s important to note the potential implications of these types of activities.

Despite the fact that social media tends to be a low-keyed, casual type of communication, advertising regulations don’t go away. In

The Federal Trade Commission recently announced that it was updating its document Dot Com Disclosures: Information About Online
Advertising. The primary focus of the document, which was first issued in 2000, is to inform advertisers that consumer protection laws and
the requirement to provide clear and conspicuous disclosures applies to the online world in addition to the offline world.

So, in a nutshell, if inventory is posted or prices/payments are quoted on social media it’s likely that the posts will be deemed to be
advertisements and will be subject to state and federal disclosure and truth in advertising regulations. Lack of space is no excuse either.
Even if you’re advertising on Twitter and limited to 140 characters, you must include a clear link to any necessary disclosures. A good
rule of thumb is to have any information that could possibly be construed as advertising reviewed by upper management or a qualified professional before it is posted.

Social Media Policy

Social media applications such as blogs, social networking, and video sharing have soared in popularity so it’s important that dealers control
the information that’s coming out of their business. Policies and procedures should be put in place to spell out how employees are expected
to conduct themselves within social media. A social media policy can help take the guesswork

out of what is appropriate for employees to
post about a company to their social networks.

There are a number of potential legal issues with employees’ use of social media that should be addressed such as the danger of possible privacy, harassment, discrimination or defamation claims. Beyond legal risks, employees can harm a company’s reputation by disseminating
controversial or inappropriate comments regarding the employer. However, employer restrictions on the use of social media can be tricky. The National Labor Relations Board (NLRB) recently issued a complaint against an Illinois dealership, alleging that the dealership unlawfully terminated an employee for making critical comments about the dealership on Facebook. While some unprofessional and inappropriate
conduct may not be protected, the intersection of social media and the NLRA is an evolving area of the law.

The best way to protect your dealership from legal trouble is by establishing formal social media policies for your staff. Companies often
get in the most trouble when they fail to train their employees about appropriate social media use and disclosure. To prevent this from
happening, it’s a good idea to create a written social media policy and training program for your company and carefully monitor social
media use Article Source:


As the leader in “Customized In-Dealership Coaching & Training” in the Automotive Industry, Jay will work with your business and your team to create your own dynamic training program that will get ongoing results.


Online Video training will keep the momentum going after the Initial training. Each page in the Training workbooks are recorded separately so your team can go right to the specific situation they want to learn more about, understand the philosophy and see the technique demonstrated. Each topic can be viewed as many times you would like, 24 hours a day. The Online Video training is the best way to protect your training program and develop skills long term.


Workshop Training is a great way to get you and your team out of their comfort zone by training them offsite. We will discuss and demonstrate many of the common situations that your team will have to deal with along with specific examples of how to give every Guest a “Wow” experience. This is a great way to get every member of your team on the same playbook.


In-Dealership training is customized to your dealership’s specific needs. We will evaluate your current activity tracking and performance, meet with senior management, department managers and individual producers and review the GTS Training philosophy and techniques to ensure a perfect fit for the culture of your team. We will then put together a customer tailored 30-day plan. Our hands-on approach will allow your team to learn this new training technology and skills that will take your dealership to the next level. Every department will get a plan for the next step and be followed up with. In-Dealership training is the most effective way to develop skills and get immediate results.


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