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Greetings!
Merry Christmas! Title laws go into effect on July 1, 2014, for powersports vehicles. Below we review those new laws for you. Also remember that if you are a motor vehicle dealer, but take powersport vehicles in on trade and resell those vehicles (even if you wholesale them) - you must hold a Powersport Dealer's License as well as your Motor Vehicle Dealer's License. We continue to see dealers and salespersons brought up on charges for regulatory and legal violations. Are you being diligent in policing your actions as well as those of your employees? Read some of the violations, along with sanctions that dealer's are facing.
New FCC regulations are effective October 16th, 2013, requiring "prior express written consent" for telemarketing calls made using autodialers (includes PC's) and/or pre-recorded messages.
And a reminder to Wholesalers of the rules for their licenses!
We wish you a Merry Christmas and the best for the new year. Thank you for allowing us to serve you in 2013.
Mary Marvin & Connie Hatch
CAPSS LLC
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Powersport Legislative Changes
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Titles for Off-Highway Vehicles
If you sell powersport vehicles, remember you must adhere to the new law changes regulating off-highway vehicles. An off-highway vehicle is defined as: A self-propelled vehicle that is:
- Designed to travel on wheels or tracks in contact with the ground
- Designed primarily for use off of the public highway; and
- Generally and commonly used to transport persons for recreational purposes
Off-highway vehicles include vehicles known as all-terrain vehicles and snowmobiles, but does not include:
- Toy vehicles
- Vehicles designed and used primarily for travel on, over, or in the water
- Military vehicles
- Golf carts or golf cars
- Vehicles designed and used to carry persons with disabilities
- Vehicles designed and used specifically for agricultural, logging, or mining purposes
- Motor vehicles
Beginning July 1, 2014, any dealer selling off-highway vehicles, new or used, must provide a title. This change does not apply to the sale or transfer of off-highway vehicles first purchased or transferred before July 1, 2014; until the off-highway vehicle is sold or transferred to a powersports vehicle dealer after July 1, 2014.
A person shall not sell or otherwise transfer an off-highway vehicle to a purchaser or transferee without delivering to the purchaser or transferee a certificate of title to that vehicle, duly transferred.
Upon the sale or transfer to a dealer of an off-highway vehicle, for which a Colorado Certificate of Title has been issued; the dealer shall transfer and file the Certificate of Title to the off-highway vehicle, except that, so long as the vehicle remains in the dealer's possession and at the dealer's place of business for sale and for no other purpose, the dealer need not file for a new Certificate of Title.
A dealer of an off-highway vehicle shall within thirty (30) days after the sale, deliver or facilitate the delivery of the title to a purchaser or lienholder.
Upon filing a lien, a title shall not be issued unless the owner includes a signed original or signed duplicate of the mortgage or copy thereof, certified by the holder of the mortgage or the holder's agent to be a true copy of the signed original mortgage.
If an applicant for a Certificate of Title to an off-highway vehicle is unable to provide the Department with a Certificate of Title, duly transferred to the applicant, the applicant may apply for a bond title.
An applicant need not furnish the surety for an off-highway vehicle if the applicant submits an affidavit, under penalty of perjury, attesting to ownership of the vehicle AND
- if the vehicle was moved to Colorado from a state not issuing certificate of title for off-highway vehicles;
- is used and held as inventory by a powersport's dealer;
- was owned by an agency of the United States or another state or a political subdivision thereof;
- was owned by an agricultural producer;
- was owned exclusively for the purpose of being operated in an organized competitive or non-competitive event;
- or was used by a dealer, manufacturer, or authorized designee for an off-highway vehicle to operate an education or safety program.
An off-highway vehicle shall be registered at the address where the vehicle is permanently maintained. It is unlawful for a person who is a resident of this state to obtain a title to an off-highway vehicle at an address other than:
- if it is owned by a business and operated primarily for business purpose
- the address where the vehicle is principally operated and maintained;
OR
- if an off-highway vehicle is permanently maintained at an address other than the address of the owner's residence
- the vehicle must be registered at the address where the vehicle is permanently maintained.
A person required to apply for a Certificate of Title for an off-highway vehicle shall use the identification number placed upon the vehicle by the manufacturer or the special vehicle identification number assigned to the off-highway vehicle by the Department. If the vehicle does not have a conforming identification number or is a duplicate, the Department shall assign a special identification number for the Certificate of Title and require the owner to place the number on the vehicle.
Unless the owner has obtained a Certificate of Title for an off-highway vehicle, a person shall not sell the off-highway vehicle and an off-highway vehicle dealer shall not purchase the off-highway vehicle.
EFFECTIVE July 1, 2014.
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Criminal or Regulatory Violations - Not at my dealership!
| | Unlicensed Salespersons - Non-Reporting Cash Transactions - Falsifying Loan Documents |
Check out the headlines and you will find dealers convicted of these and more.
Can you afford a $20,000 fine? That amount was what one dealer recently was assessed by the Dealer Board. Don't let an unlicensed employee greet customers or even talk to them on the phone! And check the expiration dates of your currently licensed salespersons. We continue to see dealers brought to the Motor Vehicle Dealer Board for administrative hearings for conducting business with unlicensed salespersons. It is your responsibility to make sure each salesperson is properly licensed before allowing them to interact with your customers. Do you have salespersons with expired licenses? Even though the state sends out renewal notices - those can get lost or misplaced. Keep an active tickler system to ensure all licenses are renewed on time.
Forfeiting $1.5 million and paying a fine of $250,000 - this occurred when Zein Automobiles pleaded guilty in U.S. District Court in Seattle recently to a charge of failing to file a monetary transaction report. Don't forget that all cash transactions over $10,000 must be reported on the IRS Form 8300.
Prison sentences of over 4 years each were handed down to brothers, Abdel Baset Jawad and Abdul Muniem Mohamad Jawad after they were found guilty in federal court for bank fraud. The Jawad brothers owned and operated various used car dealerships in California. The Jawads, and other employees (who also were sentenced to prison), entered fictitious information on loan applications or inflated earnings amounts so their customers could qualify for financing.
A Federal Grand Jury recently indicted a former sales manager of Serra Nissan (Alabama), Abdul Islam Mughal, for bank fraud. An FBI investigation alleges Mughal fraudulently falsified customer's loan documents and submitted that information to various financial institutions to obtain financing. Mughal has pleaded not guilty at this time.
Whatever the violation - the consequences can be severe. Stay up to date on regulatory issues and ensure your employees are doing the same! Dealers should be checking what is done in their name or the name of their dealership, as they can ultimately be held responsible.
If you or your employees need a refresher on regulatory matters, we offer a seminar "The Well Informed Dealer". We will even bring this class to your dealership - contact us if you want to schedule this seminar.
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New Regulations - Consent Requirements for Telephone Calls & Text Messages
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FCC Regulations effective October 16th - 2013
As of October 16, 2013, the exemption for a previous business relationship with your customer is no longer allowed for telemarketing phone calls. The FCC rule also prohibits a forced consent to telemarketing calls as part of an exchange of goods/services. The new regulations require dealers to get "prior express written consent" to autodialed or prerecorded telemarketing calls to wireless numbers and prerecorded calls to residential lines. The regulations also require an automated opt-out mechanism at the beginning of the call.
Automatic Telephone Dialing Systems and Artificial or Prerecorded Voice Calls
The FCC has specific rules for automatic telephone dialing systems, also known as "autodialers." These devices can be particularly annoying and generate many consumer complaints. The rules regarding automatically dialed and prerecorded calls apply whether or not you have registered your home phone number(s) on the national Do-Not-Call list.
Autodialers can produce, store and dial telephone numbers using a random or sequential number generator. They often place artificial (computerized) or prerecorded voice calls. The use of autodialers, including predictive dialers, often results in abandoned calls - hang-ups or "dead air." Except for emergency calls or calls made with the prior express consent of the person being called, autodialers and any artificial or prerecorded voice messages may not be used to contact numbers assigned to:
- any emergency telephone line;
- the telephone line of any guest or patient room at a hospital, health care facility, home for the elderly or similar establishment;
- a paging service, wireless phone service (including both voice calls and text messages) or other commercial mobile radio service; or
- any other service for which the person being called would be charged for the call.
Calls using artificial or prerecorded voice messages - including those that do not use autodialers - may not be made to home phone numbers except for:
- emergency calls needed to ensure the consumer's health and safety;
- calls for which you have given prior express consent;
- non-commercial calls;
- calls that don't include or introduce any unsolicited advertisements or constitute telephone solicitations;
- calls by, or on behalf of, tax-exempt non-profit organizations; or
- calls from entities with which you have an existing business relationship (EBR)
In addition, the FCC's rules prohibit the use of autodialers in a way that ties up two or more lines of a multi-line business at the same time. All artificial or prerecorded telephone messages must state, at the beginning, the identity of the business, individual or other entity that is responsible for initiating the call. If a business is responsible for initiating the call, the name under which the entity is registered to conduct business with the State Corporation Commission (or comparable regulatory authority) must be stated. During or after the message, the caller must give the telephone number (other than that of the autodialer or prerecorded message player that placed the call) of the business, other entity, or individual that made the call so that you can call during regular business hours to ask that the company no longer call you. The number provided may not be a 900 number or any other number for which charges exceed local or long distance charges.
Autodialers that deliver a recorded message must release the called party's telephone line within five seconds of the time that the calling system receives notification that the called party's line has hung up. In some areas, you could experience a delay before you can get a dial tone again. Your local telephone company can tell you if there is a delay in your area.
Telemarketers must ensure that predictive dialers abandon no more than three percent of all calls placed and answered by a person. A call will be considered "abandoned" if it is not transferred to a live sales agent within two seconds of the recipient's greeting.
Caller Identification (ID)
If you have caller ID, a telemarketer is required to transmit or display its phone number and, if available, its name or the name and phone number of the company for which it is selling products. The display must include a phone number that you can call during regular business hours to ask that the company no longer call you. This rule applies even if you have an EBR with the company, and even if you have not registered your home phone number(s) on the national Do-Not-Call list. Before these rules took effect, the words "private," "out of area" or "unavailable" might have appeared on the Caller ID display.
The penalties provide for actual damages or statutory damages of $500 up to $1500 for each unsolicited call, fax, or text message. For more information: http://www.fcc.gov/guides/unwanted-telephone-marketing-calls
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Wholesalers
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The Dealer Board takes action against Wholesalers who violate the regulations regarding how their license is utilized. You can be fined up to $10,000 per violation, or eve lose your license for any of the following:
Wholesaler:
- May not hold a salesperson's license at the same time as licensed as a wholesaler
- May not employ a salesperson
- May not sell to the public
- May not conduct business in his/her personal name
Note: A wholesaler may not employ any individual or other dealer to purchase vehicles for the wholesale dealer.
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Upcoming Training Seminars
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 Mastery Exam Seminar:We guide you through the confusing rules and regulations that you must know to pass the state's exam. We also offer practice exams, which test your content knowledge and refine your test taking skills in preparation for the exam. We offer - In-person seminars. The Mastery Exam is administered after the class at no extra charge. Register at www.capsscolorado.com
- On-line class that can be taken from your own computer at any time. If you select the on-line class, you will still need to arrange for an approved administrator or dealer to proctor the Mastery Exam. To attend the on-line seminar, click this link: capsstraining.webex.com. Note: This seminar does not work on Apple computers.
NOTE: If you are a dealer or wholesaler applicant, you may need the Pre-Licensing Certification course which is an 8-hour course. Click here for more info: Pre-Licensing Seminar Getting the Car Deal Rolling: This seminar concentrates on how to complete the basic car deal paperwork involved in a sales transaction. It includes an introduction to the required sales documents for motor vehicles and power sport sales, and to title transfer documents. This seminar is uniquely formatted for the novice dealer/and or title clerk. Title Document Training: This seminar includes basic title documents for incoming and outgoing title transfer, various title forms, applications for title, how and why to do a VIN inspection, title assignments, odometer disclosures, secure and verifiable identification and more. The Well-Informed Dealer - Do You Think You Know It All? Are you complying with the Federal Truth-in-Mileage Act? Do you know what damage disclosure is required to be furnished to your customer? If you did not know the vehicle you sold was previously salvaged, do you have to buy the vehicle back? What charges can be added to an advertised price? This seminar covers numerous items required for compliance of industry's rules and regulations, including OFAC, Red Flags, and FTC Privacy Notices. Dealers taking this class will be prepared for a compliance inspection by the Auto Industry Division. To register for any of these seminars, go to www.capsscolorado.com. To schedule a class at your dealership, call Mary Marvin (Front Range) 303-478-2538; or Connie Hatch (Western Slope) 970-209-7499. |
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QUESTIONS ?
Do you have questions regarding odometer laws, salvage vehicles, repossessions, or more? Benefits of your membership include phone consultations - so don't hesitate to pick up the phone and ask those questions. Not a member? Call now to join, only $125 a year!
Our newsletters will advise you of form updates by the state, legislative changes, and other items of interest, including compliance tips for your review.
We also offer continuing education to dealers and their employees. We strive to give you the best education at reasonable prices. Classes are offered on the Front Range (Lakewood) and the Western Slope (Montrose) as well as occasional classes in other parts of the state. For more about our seminars, check out the Upcoming Training Seminars section of this newsletter, or check out web site on-line at www.capsscolorado.com.
And give us a call for all your form and supply needs!
If you have ideas on how we can better support you, please contact us!
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ABOUT US
CAPSS is a company owned and operated by experienced former investigators of the Colorado Department of Revenue, Auto Industry Division. Connie Hatch retired as a Field Investigator, after 27 years of state service. Mary Marvin retired as a Supervisor Investigator, after 32 years of state service.
For the past five years, Mary and Connie have devoted their time to directly serving motor vehicle and powersport dealers and wholesalers through training, consulting and serving. We thank you for your support and welcome your ideas on how we can better serve you.
Front Range:
Mary Marvin 303.478.2538
Western Slope: Connie Hatch | | |
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