Unfair and Deceptive Acts and Practices statutes (UDAP) cover virtually every aspect of a dealer’s sales, finance and fixed operations. Everything from advertising and marketing to consumers, staff conversations with customers, managers’ conversations with salespeople, how prices and payments are quoted, how deals are handled in F&I, how repair estimates are handled – you name it. Everyone in the dealership who deals with or markets to the public is subject to UDAP statutes and can create liability for the dealership and for themselves.
UDAPs are extremely broad and provide for enforcement by both federal and state governments to stop the practices, and individual actions for damages brought by consumers who are allegedly hurt by the practices. The FTC and state attorneys general actively pursue UDAP claims against auto dealerships and they are a favorite weapon for consumer attorneys who specialize in “auto fraud”.
What is most concerning about UDAP statutes is that they are “catch all” edicts – interpretation and enforcement of them is constantly evolving. Just because a particular act or practice isn’t specifically prohibited by law, it can be litigated as a UDAP violation if it is viewed as improper merchant conduct. These statutes allow for almost any unresolved customer complaint to snowball into a potentially devastating lawsuit.
When you look at actual enforcement actions and court cases against dealerships, there is typically one common element: the perception that the dealer was less than completely honest with a consumer. So if a dealer employee is accused of being dishonest with a customer, either by commission or omission, they may end up in a courtroom or worse.
So here are 20 things all customer-facing dealership employees should know about UDAP statutes:
Click below to read the full article:
Author: Josh Vajda
Josh Vajda is Director of Inside Sales for AutoUSA. Previously he held senior management positions with AutoNation, where he led the auto retailer’s efforts in training and development, customer satisfaction and sales operations. Josh holds a B.S. in Business Management and Marketing from Cornell University, and is passionate about community involvement. He is a member of Leadership Broward and has held board and advisory positions with the Make-a-Wish Foundation.