rex automated man for car dealer red flag compliance

Car dealership fined $175,000 for installing unapproved aftermarket parts

SACRAMENTO – The Air Resources Board fined Sunrise Ford, a car dealership with outlets in North Hollywood and Fontana, $175,000 last month for illegally modifying 2005 through 2007 model year light- and medium-duty vehicles with an aftermarket device before the vehicles were sold.

The part, called a Fuel Maximizer, is intended to improve gas mileage and performance in cars by changing the flow of air as it mixes with the gasoline before combustion. Discovery of the unapproved parts was made during a routine dealer inspection.

“We expect dealers to follow the law, which requires that certified aftermarket parts only be installed after a vehicle is sold,” said ARB Chairman Mary D. Nichols. “Our air quality can suffer when careless mistakes are made, so we hope this fine sends a strong message.”

It is illegal in the state of California to perform modifications on a new car prior to sale. Modifying car engines can increase harmful emissions and may lead to the vehicle failing California’s smog test.

Per the terms of the settlement, Sunrise Ford will pay a total of $175,000 to the California Air Pollution Control Fund which supports research and programs intended to reduce California’s carbon footprint.

California’s air quality measures are in place to prevent excessive emissions that can negatively affect public health. Ozone, also known as urban smog, can cause difficulty breathing, shortness of breath, coughs, heightened asthma rates, cardiopulmonary ailments and premature deaths.

The Air Resources Board is a department of the California Environmental Protection Agency. ARB’s mission is to promote and protect public health, welfare, and ecological resources through effective reduction of air pollutants while recognizing and considering effects on the economy. The ARB oversees all air pollution control efforts in California to attain and maintain health based air quality standards.

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AutoZone Settlement Totals $90,000

SACRAMENTO – The California Air Resources Board reached a settlement with AutoZone West, Inc. for $90,000 in March for selling non certified aftermarket catalytic converters from AutoZone stores in California.

An ARB investigation showed that AutoZone, headquartered in Memphis, TN, sold non-certified catalytic converters from its California stores between January and March of 2009.

“Vehicle emissions are the main contributor of smog-forming pollutants in California,” said Chairman Mary D. Nichols. “Automotive retailers are required to stock products that meet California’s clean air goals.”

As of January 1, 2009, all new aftermarket catalytic converters sold or installed in California must be able to comply with certification emissions standards for five years or 50,000 miles. Manufacturers must first demonstrate through emission testing that the catalytic converters meet the required performance levels and obtain ARB approval before they can legally offer units for sale in California.

AutoZone paid $90,000 in penalties to the California Air Pollution Control Fund for funding projects and research to improve California’s air quality. In addition to the penalties, AutoZone took quick action to remove any remaining non-certified product from its California stores, and it is enhancing its restricted product system to prevent similar violations in the future.

California’s air quality measures are in place to prevent excessive emissions that can negatively affect public health. Ozone, also known as smog, can cause difficulty breathing, shortness of breath, coughs, heightened asthma rates, cardiopulmonary ailments and premature deaths.

The Air Resources Board is a department of the California Environmental Protection Agency. ARB’s mission is to promote and protect public health, welfare, and ecological resources through effective reduction of air pollutants while recognizing and considering effects on the economy. The ARB oversees all air pollution control efforts in California to attain and maintain health based air quality standards.

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FTC Extends Enforcement Deadline for Identity Theft Red Flags Rule

At the request of Members of Congress, the Federal Trade Commission is delaying enforcement of the “Red Flags” Rule until June 1, 2010, for financial institutions and creditors subject to enforcement by the FTC.

CAR DEALERS WILL HAVE UNTIL JUNE 1, 2010 TO MEET RED FLAG RULES COMPLIANCE

The Rule was promulgated under the Fair and Accurate Credit Transactions Act, in which Congress directed the Commission and other agencies to develop regulations requiring “creditors” and “financial institutions” to address the risk of identity theft. The resulting Red Flags Rule requires all such entities that have “covered accounts” to develop and implement written identity theft prevention programs to help identify, detect, and respond to patterns, practices, or specific activities – known as “red flags” – that could indicate identity theft.

The Commission previously delayed the enforcement of the Rule for entities under its jurisdiction until November 1, 2009. The Commission staff has continued to provide guidance to entities within its jurisdiction, both through materials posted on the dedicated Red Flags Rule Web site (www.ftc.gov/redflagsrule), and in speeches and participation in seminars, conferences and other training events to numerous groups. The Commission also published a compliance guide for business, and created a template that enables low risk entities to create an identity theft program with an easy-to-use online form. FTC staff has published numerous general and industry-specific articles, released a video explaining the Rule, and continues to respond to inquiries from the public. To assist further with compliance, FTC staff has worked with a number of trade associations that have chosen to develop model policies or specialized guidance for their members.

On October 30, 2009, the U.S. District Court for the District of Columbia ruled that the FTC may not apply the Red Flags Rule to attorneys. Today’s announcement that the Commission will delay enforcement of the Rule until June 1, 2010, does not affect the separate timeline of that proceeding and any possible appeals. Nor does it affect other federal agencies’ ongoing enforcement for financial institutions and creditors subject to their oversight.

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private party sales

require the owners name on title to match the sellers name

ALWAYS check and verify the sellers ID when making

a private party purchase

the seller must ALWAYS provide a current smog certificate

if the seller is not on title

and there is no smog certificate with the car

BUYER BEWARE

WALK AWAY FROM THE DEAL

new california law ( Jan. 2009 )

imposes seizure and impound rules

on private party sales if the seller is not the owner on title

( You may sell up to 5 private party vehicles per year )

unlicensed car dealers, known as curbstoners

are in a grace period

dmv and local law enforcement have been advised

on this new law

POST ADVISORY from a law enforcement bulletin:

VEHICLE REMOVAL
Vehicle Code Section 22651
Chapter 736 / Assembly Bill 2042

SUMMARY: This new law authorizes a peace officer to
remove a vehicle when the driver is cited for a
violation of acting as a dealer,
manufacturer, or transporter without
the required license or temporary permit
issued by the Department of Motor Vehicles (DMV)
while the vehicle is being offered for sale.

HIGHLIGHTS:
Section 22651 VC was amended
to allow a peace officer
to remove a vehicle after issuing a citation for a
violation of Section 11700 VC,
if the vehicle is being offered for sale.

WHAT THIS BILL MEANS TO LAW ENFORCEMENT:
This new law authorizes a peace officer to remove
a vehicle upon issuing a citation to an individual
who is conducting business as a vehicle dealer for profit
without having a valid license or permit from the DMV
if that vehicle is being offered for sale.

The purpose of this bill is to deter persons from
fraudulently acting as a car dealer
without the appropriate license.
Unlicensed dealers create potential harm for buyers
who purchase vehicles without the protection against
unpaid back fees, unpaid parking tickets,
lack of appropriate smog certificates,
or who unsuspectingly
purchase vehicles that were previously stolen or salvaged.

……………………………………………………..

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CAR DEALER CLASS HOT TOPICS
TriStar Motors LLC + Car Dealer Education + DMV Service Providers
http://www.gotplates.com

We provide the best car dealer education in all of California.
Our in-person classes are offered in 25 cities and we conduct more classes than any other dealer education provider.
At anytime, if you have questions or need help in solving a problem you may visit our car dealer blog:
http://www.autogodfather.com

Charlotte will also respond to questions at 800..901..5950.

During our in-person training session there is always discussion between the dealer pre – licensing applicants and the course instructor.
Many of the dealer pre – licensing applicants have auto industry experience and bring to the discussion a wealth of experience and problem solving ability. This creativity is encouraged and not available in our online pre – licensing tutorial training sessions.

The online pre – licensing tutorial training session allows the student to prepare themselves for the in-person training and bring relevant questions to class. The online pre – licensing tutorial training session along with pre-payment ALSO brings a discount of $ 100.
CA DMV requires a six hour in-person course for pre – licensing.
Private Car Dealer education classes are available and great for 1-on-1 training. To signup for our private car dealer class:
http://www.gotplates.com/signupformnd300.php?type=New%20Dealer%20Licensing%20Class&x_amount=300.00

Car Dealer Education Discussion Points

Remember, character is doing the right thing, when no one is looking.
There are almost 15,000 licensed dealers and over 100,000 licensed salespersons in California. The DMV, CHP and Board of Equalization have less than 800 people monitoring the automotive sales industry.
Happy customers make for good business. If you are diligent in responding to customer complaints, pay your sales tax and registration fees on time and NEVER write a bad check you will sail through this car dealer business.
If you need to file a complaint with the dmv against any dealer:
http://www.dmv.ca.gov/forms/inv/inv172.pdf

If you need to get a dealers attention, file on his bond.
In the acquisition process many dealers have disputes over non-disclosed items. All auctions must be licensed dealers as of Jan. 01, 2001. All vehicles must meet the minimum safety standard ( Division 12 ) or be declared sub-standard in writing.
If you need the assistance of a good dmv attorney visit:
http://www.civilizedlaw.com

Remember, most enforcement action is the result of salesperson error.
In the sales process, the dealer is responsible for all claims made by their sales people. Maintaining strict control of all ROS forms and allowing time for adequate document review prior to each sale is critical.
If you need to train your salespeople, free online training at:
http://www.licensedsalesperson.com

Paying of a finders fee is strictly prohibited.
The only finders fee legally allowed in the auto sales industry is to licensed auto-brokers. Any dealer may become a licensed auto-broker, the first year endorsement cost is $ 50. Any licensed salesperson may collect a broker fee, when added to an existing auto-broker’s license. For more information from the dmv regarding autobrokers:
http://www.dmv.ca.gov/vehindustry/ol/autobrkr_end.htm

Consignments require a retail license with agreement & accounting.
A retail dealer may accept any vehicle on consignment. A wholesale dealer may not accept consignment from a private party. An accounting and payment must be made in all cases within 20 days of the sale date. Dealers may NEVER consign vehicles to each other. For more information from the dmv regarding consignments:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/ch20.pdf

Offsite sales are strictly prohibited.
A retail dealer is only allowed to sell as his licensed location. This rule insures the proper distribution of sales taxes collected and that required disclosure has been made to the customer with properly posted signage ( provided for free to each car dealer student ).
If you need retail sales forms we suggest:
http://www.jodyforster.com

Sales licenses must be posted & endorsed by a dealer.
A salesperson may only post his license at one dealership. The DMV must be notified within 10 days of hiring or firing. We suggest the salesperson maintain a color copy while the original is posted at the dealership location. For more dmv licensed salesperson information:
http://www.dmv.ca.gov/vehindustry/ol/ol_handbooks/ol303.pdf

Spanish copy provisions cannot be waived.
The DMV requires a spanish copy of the sales contract, required disclosures and buyers guide for all buyers with Spanish surname. The providing of a translator does not relieve this burden from the dealer. For dmv spanish copy forms:
http://www.jodyforster.com

DMV fees can be estimated for retail customers.
The DMV allows the retail dealer to estimate fees and make refund upon completion of the registration application. The formula for 12 months of registration fees is: ( 2.2% + $ 60.) X .70
The DMV hotline number is 800..777..0133
Dealers are never allowed to charge back fees to a customer. Buyers fees for registration begin of the date of sale only. For dmv registration requirements:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/toc.htm

Retail Sales are like a light switch, either ON or OFF.
If the sale is completed, the switch is ON, keep it all. If the sale is not completed, the switch is OFF, and all funds and the trade-in, if any, must be returned. For dmv refund information:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/ch24.pdf

Deposits are fully refundable & cannot be waived.
Any deposit taken to hold a vehicle for retail sale and/or accessories is fully refundable if the sale is not completed. Failure to refund a deposit will get immediate attention from the DMV. For dmv deposit information:
http://www.dmv.ca.gov/pubs/vctop/d05/vc11737.htm

The maximum charge for documents is $ 55.
The charge for documents is optional and is NOT a government fee. The fee charged to all customers must be the same across the board. Any discrepancy would cause a refund to overcharged customers by the DMV. The fee must be disclosed and is taxable labor. For more dmv information regarding the dealer document fee:
http://www.dmv.ca.gov/pubs/vctop/d05/vc11713_1.htm

The maximum charge for smog inspection is $ 50.
The charge for smog inspection is optional and is NOT a government fee. The fee charged to all customers must be the same across the board. Any discrepancy would cause a refund to overcharged customers by the DMV. The fee must be disclosed and is taxable labor. A non-taxable fee of $ 8.25 is also allowed for the smog certificate fee. For more dmv information regarding the smog inspection fee:
http://www.dmv.ca.gov/pubs/vctop/d05/vc11713_1.htm

A dealer may charge interest of choice, with no limit.
Vehicle dealers are exempt from the usury restrictions of banks and finance customers, provided they disclose this fact and place themselves as lienholders on title. A dealer may repossess without notice upon default. Vehicle dealers are exempt from the 15 day notice requirement and may repossess at will, following the customary 5 day grace period, granted on every contract. For ca attorney general usury guidelines:
http://ag.ca.gov/consumers/general/usury.php

An open DO bill is a potential deal breaker.
Vehicle dealers using DO bills must provide documentation of completion to seal the deal and make the contract enforceable. An expiration date on the DO bill is useless. For do bills and dealer forms:
http://www.jodyforster.com

The buyers county of residence sets the sales tax rate.
The location of your dealership does not determine the rate of sales tax. Exempt transactions, dealer to dealer, out of state, out of country require exact paperwork to maintain the sales tax exemption. For current board of equalization sales tax rates:
http://www.boe.ca.gov/sutax/pam71.htm

Personal use requires a monthly use tax.
Any use of the dealer plate for personal use is taxable. The purchase price divided by 40 sets the taxable monthly base for dealers. The purchase price divided by 60 sets the taxable monthly base for salespersons renting a dealer vehicle. The taxable monthly base is then multiplied by the sales tax rate at the dealer location to determine the use tax due.Personal use is reported to the Board of Equalization. There is no requirement to report personal use to the DMV. The personal use of the dealer plate is reported on Line 2 of the sales tax report form sent to the Board of Equalization. For use tax rules from the board of equalization:
http://www.boe.ca.gov/pdf/pub110.pdf

Blank DMV registration & ROS forms can be ordered by mail.
The form office at DMV provides dealers with blank forms at no charge. A request on the dealer letterhead to the forms office will provide you all the forms you may need. Dealers may post flashers on sold vehicles. When a dealer posts a temporary operating permit on a vehicle the dealer may post flashers, license plate covers, over the existing plates, with instructions for removal upon the buyer receiving documents and registration stickers from the DMV. For dmv bulk forms ordering information:
http://www.dmv.ca.gov/pubs/brochures/fast_facts/ffdmv1.htm

Unpaid DMV administrative service fees causes loss of license.
When the DMV accesses an ASF upon a dealer, these fees must be paid immediately, even if the ASF is under protest. Failure to pay an ASF will result in bond activation and failure to pay the bond company will result in license termination. For dmv ASF information:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/ch19.pdf

A retail dealer may sell to an unlicensed buyer.
The DMV has no requirement for any buyer to be a licensed driver. The RED section of the 553 sales contract requires the buyer to sign as to an understanding of this provision. A finance company may require a drivers license and insurance prior to release of a vehicle to a buyer, but, this is not state law.Every dealer shall obtain photo ID of the buyer.
The retail dealer must offer a cancellation option on all used vehicles offered for sale after july 1, 2006. For more car buyer bill of rights information:
http://www.carbuyerbillofrights.com
http://www.dmv.ca.gov/pubs/brochures/fast_facts/ffvr35.htm

The retail dealer must abide by new federal red flag rules on all vehicle sales where credit is offered or assistance provided. For free red flag rules tutorial training and assistance:
http://www.redflagclass.com
http://www.rexhead.net
For our $ 500. red flag program for licensed dealers:
http://www.gotplates.com/redflagform.php

Every out of state sale can be tax exempt.
Delivery is the condition which determines if taxes must be posted at the time of sale. If the out of state buyer is using a licensed transporter to have the vehicle delivered, the bill of lading exempts the collection of sales tax. If you, your staff or the buyer takes delivery, a notarized statement at delivery to an out of state location allows refund of sales tax posted at sale. For dmv out of state tax exempt regulations:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/ch07.pdf

Division 12 is a federal law and cannot be waived at retail.
Division 12 is the minimum safety standard for all motor vehicles sold at retail by licensed dealers. The vehicle must meet these requirements or it cannot be sold. In wholesale transactions, the vehicle may be sold to another dealer with written disclosure. For dmv minimum safety standards:
http://www.dmv.ca.gov/pubs/vctop/d12/vc24007.htm

A voluntary repossession does not require a certificate.
If the customer is willing to sign the title on line 1a and return a vehicle the certificate of repossession is not necessary. A voluntary repossession in this manner is handled as a buyback. For dmv reposession form requirements:
http://www.dmv.ca.gov/forms/reg/reg119.pdf

Dealer smog certificates are good for two years.
When a dealer obtains a smog, required to offer the vehicle for retail sale within California, it has a useful life of two years. A dealer who obtains a vehicle with an unused smog is not required to re-smog the vehicle prior to sale. For dmv dealer smog rules:
http://www.dmv.ca.gov/pubs/reg_hdbk_pdf/ch21.pdf

Division 12 is an implied warranty.
The buyers guide has a provision for ” AS-IS, No Warranty ” The dealer should remember it really means, as-is, no warranty, except Division 12, the minimum safety standard. for the FTC sample federal buyers guide:
http://www.ftc.gov/bcp/edu/pubs/business/autos/bus13.pdf

Dealers may never post a for sale sign on the street.
All vehicles operated on the highway, or parked on the highway must never have a for sale sign posted on them.

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charlotte
800-901-5950

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we at gotplates.com are the leaders in california car dealer education

since april 1998, we have been teaching pre-licensing dealer certification

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REMEMBER, we make it simple for you

free dmv sample pre-licensing examination:
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free dmv licensed salesperson tutorial:
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free dmv car dealer renewal continuing education tutorial:
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free red flag identity theft staff red flag compliance tutorial:
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free car buyer bill of rights dealer education tutorial:
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free dmv registration secret to the paperwork tutorial:
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free car dealer education posters:
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free how to become a car dealer checklist:
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free car dealer bond quote:
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free dmv car dealer application:
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free dmv licensed salesperson application:
www.dmv.ca.gov/vehindustry/ol/salesperson.htm

free dmv car dealer education handbook:
www.dmv.ca.gov/pubs/reg_hdbk_pdf/toc.htm

free car dealer education blogs:
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www.rexhead.net

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if you have a knack for customer service
consider becoming a licensed autobroker
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our car dealer education class is the first step to
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the broker endorsement on your car dealer license
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as a matter of fact, licensed brokers
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The concept behind hiring an auto broker is relatively simple:
you’re not a professional car buyer, so why go up against a professional car seller alone?

With the confusion of financing, fees, add-ons, taxes and the hurried, jargon-filled nature of the dealership, it only makes sense to leave the bargaining to someone who won’t be fazed by the wheeling and dealing.

Fees for these services can start at $200 and can go as high as $1,000 normally, based on the car you’re brokering and whether it is a new or used model. Used cars and rare cars tend to carry a higher fee since it takes more legwork to locate a good deal; although, you’ll likely see an even deeper discount from the buyers best walkin price thanks to regional differences in used car prices.

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california dmv autobroker handbook information

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the two major hurdles to getting a car dealer license are:

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surety bond approval ( bond cost is based on your credit )

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the major car dealer license expense is car dealer insurance

car dealer licensing requires commercial dealer insurance

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location insurance for the office

complete vehicle coverage up to a stated value limit

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11580 of the insurance code handles dealer plated test drives by customers

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