Titles and compliance
What is Safeguards Rule?
The FTC Safeguards Rule requires dealers who arrange financing to run a written information security program protecting customer data.
Dealers are treated as financial institutions for this purpose because they arrange credit. Required elements include a named qualified individual, a written risk assessment, encryption in transit and at rest, and multi-factor authentication for anyone accessing a system with customer information.
Smaller dealers get relief from some elements below 5,000 consumers, but encryption and MFA are not among the exemptions.
It also requires disposing of customer information no later than two years after the last time it was used, which makes an indefinite pile of scanned deal jackets a liability rather than an asset.
Source: 16 CFR 314.4 (required elements)
Handle this automatically
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Related terms
Deal jacket
The deal jacket is the complete file for one sale: buyer, vehicle, money, and every signed disclosure, kept together so the deal can be reconstructed years later.
Form 8300
Form 8300 reports cash received over $10,000 in one transaction or in related transactions, and dealers must file it within 15 days.
General information for US dealers, not legal advice. Rules change and vary by state, so confirm specifics with your state agency or counsel.