Prevent the FTC from Taking Action Against Your Dealership

By Amir Dabiri - June 3, 2014

From the beginning of its inception four years ago, the Consumer Financial Protection Bureau, which regulates auto lending, has been a strong new focal point for car dealerships. But recently dealerships are being quickly reminded who primary regulates their business, the Federal Trade Commission. In the past 18 months, the FTC has been more active in regulating dealerships than it has in the past 10 years. It has been focusing its attention on dealer advertising and how it can be misleading, especially to the average consumer.


The following nine areas have been highlighted as being closely monitored by the FTC:

  • Deceptive pricing
  • Deceptive teaser payments
  • Undisclosed balloon payments
  • False $0 up-front leasing claims
  • Undisclosed lease terms
  • Hidden rates
  • Bogus prize promotions and sweepstakes
  • Credit and leasing violations under Truth in Lending, Regulation Z, the Consumer Leasing Act and Regulation M.


The key when advertising is to use language the average consumer would understand. Do not promote an ad that is either vague or is lacking important relevant information. If you do decide to disclose terms in your fine print, these terms and conditions should not contradict the main highlights of your ad. But always remember, legal counsel is your best bet, especially when in doubt of compliance.

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