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Dealerships take their eye off compliance ball

Dealerships that have put in effort to make themselves FSA compliant 15 months ago have are failing to maintain standards, according to regulatory compliance consultancy, PEAK.

Since the end of 2004, dealerships have been preparing themselves for the requirement to comply with FSA regulations when selling financial products.

From a sample of over 500 tests and re-tests completed over a 15-month period, the results show pass rates by dealership sales staff have fallen from 85.4% to 72.47% between the initial tests and the re-tests, even though the tests were of the same standard.

The percentage of sales staff who passed, but require some further development increased from 49% to 84%.

In the assessments, sales staff can either fail through getting a mandatory question wrong or because they failed a number of minor components in a case study exercise. The percentage failing on mandatory questions almost doubled between the initial assessments and the re-tests to 11.24%.

PEAK managing director Mark Tumblety says: “After an initial surge of activity within the industry to make sure it complies with the regulations, we understand why concentration has now moved to one of the many other issues facing dealerships and why they may have taken their eye off this particular ball.

“It also shows that there is still a lot of work to do to increase the basic level of understanding about the rules and why we need them”.

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