Saturday, December 13, 2014

The FTC Strikes AGAIN - What a Surprise!



The Federal Trade Commission started the year by making a major statement regarding how they feel about questionable auto dealer advertising practices with their Operation Steer Clear action in January. Just to remind us that they weren't kidding around, they've apparently decided to end the year with a splash: FTC Takes Action Against Two Auto Dealership Chains For Violating 2012 Orders Prohibiting Deceptive Advertising of Vehicle Costs.

As I predicted in my January 22nd post, The FTC Strikes Again - You Ain't Seen Nothing Yet, dealer advertising is on the FTC's radar and they're not going away anytime soon.

According to media accounts, one of the dealers cited in the most recent action stated "Was it fair? Absolutely not. The reason we settled it was because it was less expensive than to go to court." 

Well, as we parents are so fond of telling our children: "Life isn't fair..."

This dealer and his legal counsel apparently feel that the FTC has not been clear in delineating their expectations regarding compliant advertising. Perhaps that's true, but after attending the FTC's dealer advertising press conference this past March, I'm not sure I completely agree. As I outlined in the post Key Takeaways from the FTC's Dealer Advertising Webinar, it seems to me that the FTC has been pretty forthcoming about their perspectives regarding proper advertising.

I've said it many times before and I'll say it once again: If you’re not sure that your advertising is compliant, don’t guess! It makes sense to have your advertisements reviewed, and edited if necessary, by someone knowledgeable before publication. It may cost a few bucks, but it’s a small price to pay.

$360,000 (plus legal fees) and bad press seems like a really high price to pay for guessing wrong.

For a quick refresher on how regulators view advertising, you may want to check out this post: 10 Advertising Guidelines That Every Dealer Should Be Familiar With.

7 comments:

  1. Great article and great advice.

    I am amazed at the advertising here in Florida. The FTC will have a field day when they come to visit.

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  2. Thank you sir! Those who walk the line between legal and illegal always think the FTC hasn't been clear enough. Rather than walk the line and testing the government, I suggest they choose one side of the line or the other and then accept the consequences of their actions without whining. Those who obey the law breathe a little easier when those who test it get slammed.

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  3. An interesting thing is, this is the same dealer who was charged by FTC in May of 2012. This action by FTC is simply a follow up, but it is amazing that he would not learn the first time.

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