The Federal Trade Commission (FTC) is tightening regulations on auto dealerships’ adherence to the FTC Safeguards Rule. Non-compliance could result in fines of up to $50,000. Securely managing documents is a significant challenge for many dealerships but crucial for avoiding hefty penalties.

Dealerships have options to ensure they stay in compliance:

  • 1. Stick with traditional paper filings and storage.
  • 2. Set up an in-house process to digitize documents.
  • 3. Outsource digitization to a dealership document management solution.

Traditional Paper Filing and Storage

Relying on paper filing and storage poses risks. Sensitive information is easily exposed, especially with the high volume of documents dealerships handle. Paper documents must be stored for up to a decade, and off-site storage costs can quickly escalate.

In-House Dealership Document Management

In-house processes often fall short due to busy employees and the need for quality control (QC). Tasks like document scanning can distract valuable F&I managers from revenue-generating activities. Mistakes in scanning or organizing can lead to compliance issues during audits.

Outsource Dealership Document Management Solution

Outsourcing document management offers numerous advantages:

  • Expert Handling: Trained professionals manage scanning, QC, storage, and shredding ensuring every document is accurately digitized, securely stored and the shredded.
  • Cost Efficiency: Outsourcing reduces storage costs and minimizes the risk of data breaches.
  • Enhanced Productivity: Freeing employees from document management tasks boosts overall productivity.

When FTC compliance officers visit, dealerships using outsourced solutions benefit from a streamlined audit process. Officers can easily access digitized documents, making audits quick and efficient but, more importantly, compliant.

Dealerships must act now to protect customer information and ensure FTC compliance. Outsourcing dealership document management simplifies data security and ensures readiness for regulatory audits, safeguarding the dealership and its customers.