Dealer staff may soon be targeted by claims management companies with cash offers for customer data.
Matt Dyer, CEO of ITC Compliance said: “With a growing number of claims management companies chasing market share, it is only a matter of time before those individuals who have access to dealer customer records will be offered significant inducements to hand them over.”
This further risk comes on top of the recent comments by the head of the Financial Services Authority (FSA) signalling that the ‘light touch’ approach that they have adopted for the regulation of financial products will change.
“Regulation is clearly about to become much more complex and time consuming for directly authorised motor dealers.
Inevitably, this will see more switching to the safety and security of appointed representative status as has been the trend in other regulated industries such as with financial advisors and mortgage brokers,” said Dyer.
“Mis-selling scandals and the credit crunch have made regulators rethink their approach and the actions of some claims management companies are only going to make things more difficult for dealers.
"Any slight discrepancies in documentation, systems and controls will leave dealers unable to defend themselves against such complaints brought.”
In response, ITC Compliance has launched a free FSA healthcheck programme whereby its nationwide team of compliance professionals assess dealers’ compliance and provide a free report detailing areas where improvement may be prudent, potentially saving dealers thousands from mis-selling claims.
To register for a free ITC FSA Healthcheck simply visit www.itccompliance.co.uk or call 0117 953 9068.