The CARS Rule: What You Need To Know About the FTC’s Final Motor Vehicle Dealer Trade Regulation Rule
On December 12, 2023, the Federal Trade Commission announced its Combatting Auto Retail Scams Rule, otherwise known as the “CARS Rule,” which sets new requirements on the sale, financing, and leasing of new and used vehicles by motor vehicle dealers. The final rule prohibits certain misrepresentations in the financing process, sets disclosure requirements on dealers’ advertising and sales communications, mandates that dealers obtain consumers’ express, informed consent for charges, and prohibits the sale of add-on products or services if there is no benefit to the consumer.
In this webinar, we will discuss the new compliance requirements that the CARS Rule places on motor vehicle dealers and the impact and risks presented by the rule on banks and auto sales finance companies that purchase motor vehicle retail installment sales contracts.
Topics will include:
- Scope and Key Definitions
- Misrepresentations that are expressly prohibited under the final rule
- New disclosure requirements on dealer advertising and sales communications and the need for express, informed consent for charges included with a vehicle purchase
- How the final rule impacts the sale of add-on products
- The impact of the CARS Rule beyond “Covered Motor Vehicle Dealers”
- The intersection of the CARS Rule with other laws and regulations, including state law and the FTC’s Used Car Rule and Proposed Rule on Unfair or Deceptive Fees
- Potential litigation and legislative challenges to the validity of the final rule
- Best practices for auto sales finance companies to help navigate the new requirements
We will be joined by guest speaker Richard Hackett, Former Assistant Director of the CFPB responsible for auto finance regulation. He currently serves on the Board of F&I Sentinel, which supports lender compliance in the auto F&I industry.