FORT WORTH, Texas -

The Who song, “Won’t Get Fooled Again” ends with the words that I’ve chosen to be the title to this article, and through them, Pete Townshend sums up the subject of revolution by seemingly saying “the more things change, the more they stay the same.”

I have been thinking about these lyrics a lot lately as I contemplate the coming regulatory changes in our auto finance world. A Biden administration means that consumer advocates (dare I say zealots) will once again have the ears of those in power and in many cases be the ones in power, just like they were during the Obama presidency.

The Trump presidency’s drive to roll back regulation is over and we can expect to see more efforts to direct what’s permissible (and harsh guidance on what’s not) when selling and financing vehicles. I hope that those who were “fooled” into a false sense of complacency during the Trump years are ready to do the work necessary to please the New Boss.

When I wrote this article, Biden was President-Elect and in the middle of a transition. CFPB director Kathleen Kraninger was replaced early in the Biden administration, and we can bet that a new director will hold principles very similar to former director Richard Cordray and Sen. Elizabeth Warren, who was instrumental in the creation of the bureau, hence my choice for the title and theme of this article.

For those of you who need a history refresher, that leadership period of the CFPB was known for aggressive consumer protection through a practice that came to be referred to as “regulation by enforcement,” with the bureau deterring what it perceived as wrongful conduct across the industry with highly publicized and Draconian actions against individual companies rather than by promulgating clear rules.

That bureau aggressively pursued theories based on disparate impact, discrimination, and ability to repay arguments. That bureau issued severe penalties for what it found to be “abusive” conduct, even though “abusive” wasn’t defined. It was gearing up for a challenge to widespread use of arbitration clauses by creditors.

It published debt collection rules that blurred the lines between first- and third-party collections and demonstrated an intent to promulgate restrictions that would have fundamentally changed the way debts were collected. In the minds of those running things prior to the 2016 election, a Clinton presidency was going to allow it to continue down these paths, and it had quite a robust consumer protection agenda.

My belief is that new bureau leadership will pick up right where they left off in 2016, and we can expect more of the same. Coupled with an FTC that’s been more active in the area of consumer financial protection over the past few years, state regulators that have increased their scrutiny of the lending industry, new mini-CFPB’s being created at the state level, and a generation of plaintiffs’ lawyers that studied the CFPB’s playbook on what constitutes bad conduct by lenders, and it appears that we’re going to have to navigate some treacherous waters over the next few years.

Plus, the new CFPB leadership will certainly have more to say about servicing, collecting and even underwriting practices during the pandemic

Suggestions for operators

So what’s a BHPH dealer to do? My advice is to do your BEST, and I don’t say that flippantly.

Your businesses come in many different models and sizes. I don’t expect a dealership with 10 employees to have the same compliance resources as one with 100 employees, but I think each one has to make its BEST effort to have a demonstrable compliance program that is appropriate for the “size and complexity of its business,” as the CFPB has itself said.

When a dealership has to defend itself, whether it’s a lawsuit or a regulator action, the key is to demonstrate all the steps that have been taken to attempt to get things right. That means having a written plan for compliance, policies and procedures that show there is a commitment to doing things the right way, conducting personnel training to engrain the “right way” in daily operations, doing some audits or assessments to verify that the business is operating as it should, and facilitating a company culture that believes in treating customers in a fair and transparent manner.

I challenge each of you to re-read that last paragraph and honestly ask yourself whether you are doing your best to achieve this goal. Discuss this with your leadership team, take a look at each department or business function and make a list of areas where you are strong and those in which you may be deficient. Then take steps to close those gaps. It’s not enough to “know” you are doing it right, approach it as if you will have to present and prove it to a judge and jury one day, which means your plan has to be written and demonstrable.

The New Boss is going to be tough, a lot like the Boss before the last one. If we are going to thrive over these next several years, and make no mistake, the goal is to thrive, not just survive, then it’s up to each of you to play a leadership role in this effort. One of the first things I tell clients is that compliance isn’t something that can be bought. Sure, I can lay out the plan, but it’s got to dedicate resources to get it done. 2021 is the time to meet this challenge head-on. Protect your business and make it your goal to end the year with a stronger commitment to demonstrable compliance.

Steve Levine is chief legal and compliance officer of Ignite Consulting Partners, which offers compliance, operational and best practices guidance to car dealers and finance companies. Ignite’s team has broad experience working with businesses of all sizes. These experiences allow them to develop strategy, overcome internal obstacles and implement meaningful change. Send a message to info@IgniteCP.com to learn more. Follow Steve on Twitter @LawyerLevine for compliance and industry related content.