LAKE SUCCESS, N.Y. — This week, DealerTrack launched free additions to its performance suite meant to enable dealers to comply with the Federal Trade Commission's new risk-based pricing rule, which goes into effect on Jan. 1.

Company officials said the enhancements are available automatically to all dealerships on the DealerTrack credit application network.

DealerTrack pointed out that the risk-based pricing rule requires dealers who use credit reports to issue a notice to customers who receive credit from them on terms that are less favorable than terms received by most of their other credit customers.

The company stressed that dealers do not need to determine who falls into this category if they simply issue to all their credit applicants a credit score disclosure "exception notice." This notice includes the customer's credit score and other information that puts the score in context. 

With the new functionality, executives explained any dealership using the DealerTrack credit application network can print credit score exception notices pre-filled with all required information, as well as exception notices on their lender's behalf for two-party financing. 

In addition, dealerships subscribed to the DealerTrack Compliance Solution can securely and electronically store and view status reports on all exception notices generated by their dealership though the solution's dashboard and audit tools. DealerTrack contends this premium functionality can be especially useful in helping dealers not only maintain compliance within their dealership and also aid them prove it in the event of an FTC or attorney general audit.

DealerTrack reminded dealers that those who do not comply with the new risk-based pricing rule are subject to potential fines by the FTC of up to $16,000 per violation as well as possible penalties at the state level.

Furthermore, the company mentioned the FTC is also scheduled to begin enforcement on Jan. 1 of its Red Flags Rule, which requires dealers to take steps to detect and prevent identity theft. Non-complying dealers could receive similar penalties for each violation.

Officials stressed that DealerTrack's Compliance Solution includes tools to help dealers comply with the Red Flags Rule as well.

Raj Sundaram, senior vice president of the solutions and services group at DealerTrack, insisted the DealerTrack Compliance Solution can enable dealers to work all their deals on one integrated and secure platform.

From credit application submission to identity verification, menu presentation, contract processing, tracking and reporting, Sundaram believes DealerTrack helps protect a dealer's business by encouraging and simplifying adherence to applicable laws and regulations.

"We're very pleased to further expand DealerTrack's leading F&I offerings by including risk-based pricing functionality at no additional charge," Sundaram stated.

"These and other enhancements underscore our ongoing commitment to providing dealers with the industry's most comprehensive package of compliance capabilities, thus reducing their exposure to legal and regulatory risks," he concluded.