The window for public comment on the proposed car dealer regulations by the Federal Trade Commission (FTC) officially closed on Monday, September 12. The proposed regulations target some industry practices that have come under increasing scrutiny in recent years. As they are currently written, these regulations could have a substantial impact on the way car dealerships do business.

The FTC Received a Massive Number of Complaints About Car Dealerships in Recent Years

The new regulations appear to come in response to a high number of complaints to the FTC about car dealerships. According to the FTC, the organization received more than 100,000 complaints related to car dealers in each of the last three years.

In its public proposal, the organization states that the top 10 most common complaints they receive each year are all related to new and used motor vehicle sales, financing, service, warranties, rentals, leasing, and complaints about motor vehicle transactions. 
Many of these complaints are related to practices that have become commonplace in the auto industry. The organization describes the following scenario as having ?summed up these issues.?

?The consumer purchased a $2,000 service contract that the dealer falsely said was free, and a $900 GAP [guaranteed asset protection] insurance contract that the dealer falsely said was mandatory, and learned about these purchases during the study interview.?

The proposal also includes a quote from the aforeme...