Recording F&I Transactions? Here Are Three Things To Consider

 An editor of Automotive News recently reported on a seminar held at a F&I conference where the panelist generally endorsed using video cameras to record transactions in the F&I office.  There are pros and cons to recording these transactions.  While recordings can be helpful tools for enforcing compliance, training staff, and rebutting accusations by consumers of wrongdoing in the F&I office, they can also be the “smoking gun” of unlawful business practices that provide plaintiffs or regulators with the evidence needed to impose costly penalties and damages.

Deciding whether to record F&I transactions takes more thought than merely selecting what equipment to use.  Before you get your cameras rolling, you should consider the following:

Will You Record Every Transaction?  That one transaction your staff forgets to record could be the one where problems arise.  Worse, an employee who is violating the law may selectively record transactions or edit recordings in order to hide any transgressions.  If you decide to record your F&I staff, you should consider mandating that every F&I transaction is recorded.   If a consumer refuses to be recorded, document the refusal, and maintain adequate records to help reconcile all transactions against ones recorded.

How Does Recording F&I Transactions Fit With Your Coaching And Counseling Processes?  You should train your staff on how to record the transactions, including obtaining the consumer’s informed consent.  This will require developing a consistent script to use with consumers to obtain consent, and some written document signed by the consumer evidencing consent.  You will need to designate who will review the videos and what remedial steps are taken when problems are discovered.  Remember, supervisors should not to use the videos in a manner that demeans or humiliates their subordinates.  These ‘candid camera’ moments, used at the expense of the employee, could provide ample evidence for an employment discrimination claim.

How Does Recording F&I Transactions Fit With Your Compliance Programs?  Laws such as the Safeguards Rule and the Red Flags Rule impact how you record F&I transactions and store the recordings.  It is likely that these recordings will capture information protected by state and federal law, such as nonpublic personal information, so you will have to take necessary steps to protect this information, and determine when breaches occur.  You will need to amend the documents and records you maintain for compliance programs accordingly.

 

 

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