CRYSTAL LAKE, Ill. -

Automotive Compliance Consultants advised dealerships to remain vigilant and attentive to consumer business practices even though the U.S. Court of Appeals recently ruled the leadership structure of the Consumer Financial Protection Bureau is unconstitutional.

“The CFPB has been the biggest regulatory bully in D.C. without shame, and with a total disregard for Congress and elected officials. In its wrangling with the auto industry, in particular, Ally Financial and other auto finance companies, the CFPB clarified that you either settle with them on their terms, or suffer the consequences if you fight,” said David Missimer, general counsel for Automotive Compliance Consultants.

Missimer insisted the CFPB has made it a priority to eliminate dealers' ability to discount the APR, and continues to look for a way to affect the sale of ancillary products out of the dealership. He continued that agencies having direct jurisdiction over dealers have noticed the CFPB’s success and tactics.

He added that regulators are looking at the disclosures dealerships provide at the time of sale and are very much interested in the F&I products being sold.

Perhaps a reprieve is in the wind if this case is upheld, but Missimer cautioned dealers to remain observant and committed to consumer financing best practices.

Earlier this month, the U.S. Court of Appeals in PHH Corp. versus Consumer Financial Protection Bureau made rulings in the case that were beneficial to PHH and relevant to those watching the CFPB, says Missimer, a member of the National Association of Dealer Counsel, American Financial Services Association and National Automotive Finance Association.

• It held that the CFPB is unconstitutionally structured. With the "for cause" provision severed, the president now will have the power to remove the director at will and to supervise and direct the director. “This ruling, though,” Missimer said, “may have no teeth depending on the outcome of the upcoming election.”

• CFPB will now have to abide by the statute of limitations in all CFPB enforcement actions — the bureau had insisted that under Dodd-Frank, the law that authorized it, there were no limitations for any CFPB administrative actions.

“Should the ruling stand, it will make a significant dent in the agency’s no-prisoners approach to reviewing corporate conduct well outside any relevant statute of limitations, and demanding redress for the same,” Missimer said.

“For dealers, the message is that although the ruling is significant, it does nothing to change the agency’s determination to terminate, or severely limit dealer reserve. Sound consumer financing practices and use of documented processes and practices continue to be a must to protect the dealership,” he went on to say.

Automotive Compliance Consultants specializes in dealership and auto finance compliance, providing in-dealership consultations and analysis, compliance audits and training, and offers solutions for all compliance needs. The Automotive Compliance Consultants staff has extensive experience in the automotive retail industry and focuses exclusively on dealership compliance issues.

For information, contact Missimer at dmissimer@compliantnow.com or visit www.compliantnow.com.