As has been widely reported, the Federal Trade Commission has recently intensified scrutiny of dealer compliance with federal advertising standards. Since 2012, the FTC has initiated 5 rounds of enforcement actions against 18 dealers in 12 states for an array of alleged advertising violations. Two such rounds occurred this past December, one of which involved allegations of repeat violations (i.e., allegations that a defendant that previously entered into a consent order with the FTC to resolve alleged advertising violations engaged in subsequent violations) and resulted in, among other provisions, the payment by a dealership group defendant of a $360,000 civil penalty.
To help assist dealers, dealer attorneys, ad agencies, and others involved in dealer advertising in understanding the wide range of federal requirements that apply to dealer ads, NADA recently released its latest compliance publication entitled A Dealer Guide to Federal Advertising Requirements. This guide, which is available as a pdf on the home page of www.nada.org, contains examples of "bad" and "good" ads and includes short chapters on 41 federal advertising topics, such as the use of discount claims, email advertising, green marketing claims, internet advertising, satisfaction guarantees, and "trigger terms." Readers can quickly access content on any topic by clicking on a hyperlink in the Table of Contents.
It is important to note that while the guide addresses numerous federal advertising requirements, it does not address additional advertising requirements that may be imposed at the state or local level, which vary considerably and must be addressed when dealer ads are reviewed for legal compliance.
Paul D. Metrey
Chief Regulatory Counsel
Financial Services, Privacy, and Tax
National Automobile Dealers Association
8400 Westpark Drive
McLean, VA 22102
Posted with permission from the National Automobile Dealers Association