The future of the Dodd-Frank Act and Consumer Financial Protection Bureau has been largely questioned since President Donald Trump took office, but no matter the status of the CFPB, dealers should prioritize compliance, experts said at the Automotive News Retail Forum.
"We still have to worry about 50 attorney generals, the Federal Trade Commission, independent attorneys. Those are the ones that can really hurt us over the CFPB, who really had no jurisdiction over car dealers anyway," said Terry Dortch, founder and president of Automotive Compliance Consultants.
Many of the rules dealers must follow existed before the CFPB. Dealers should continue to have a documented compliance program in place and regularly train their staff, he said.
"Don't let yourself get sucked in to the perception that you're not going to have to worry about these issues going forward," Dortch added.
Matt Woods, director of field operations at Service Group, said the CFPB's authority could change, but politicians who try to eliminate the CFPB could hurt their careers. "For any politician to try to do away with the CFPB would be career suicide," he said. If a Democrat "says we want to get rid of something that says consumers are protected, the entire Republican side is going to say, "Hey, they're idiots. We can campaign against that.' Flip the script. If the Republicans say it, the Democrats are going to hang them out to dry."
Dortch agreed that the CFPB may be modified, but it won't be eliminated.
"They still got laws on the books today that if you spit on a sidewalk then you go to jail in some states," he said. "You're not going to go and dismantle the Dodd-Frank Act."
At the dealership level, nothing should change under the new presidential administration, said Greg Kostern, business operations director for Johnson Automotive in Raleigh, N.C. He believes compliance makes dealerships more profitable.
"The profit in the F&I department has skyrocketed when held accountable for compliance. From our standpoint, we are always looking for innovative ways to become more compliant," he said. "Even if the regulation changes from Washington, we're dedicated to best practices."
The auto industry, Woods added, has consistently been able to adjust to regulatory changes.
"For years we have learned how to be compliant, follow the regulations and still be profitable because our sole goal is to help the customer buy a car," he said. "So is the bureau going to change? Maybe, but it's about helping the customer still."