The Virginia Automobile Dealers Assn. (VADA) has backed off a proposal to create a state licensing law and governing board just for finance and insurance managers.
Instead the association now urges the state legislature to license F&I staffers as dealers and their sales people are now
Before second thoughts, the VADA's board approved the original plan to make the F&I licensing requirement more of a regulation like that for insurance and real estate brokers.
But the dealer board ultimately decided it involved “too much bureaucracy” and “unnecessary testing,” says VADA President and General Manager Don Hall.
Other state dealer associations voiced concerns over the demands on F&I managers' time to study for licensing exams as required by licensing statutes for professionals such as pharmacists and the like.
Hall says, “The sales people's and dealers' law requires background checks and a much less complicated 20-question multiple-choice test administered by the Department of Motor Vehicles.
“Adding F&I personnel makes sense as a step towards the day that they may want to sell vehicle insurance, but right now our board decided to crawl before we walk, and wait and see if vehicle insurance sales do become an F&I commodity in dealerships.”
To get a dealer's or salesperson's license in Virginia, an applicant must not possess a felony record or have been involved in recent misconduct in a vehicle sale.
Some F&I employees in the commonwealth were denied salesmen's licenses because of criminal records, says Bruce Gould, executive director of the Virginia Motor Vehicle Licensing Board that supports the proposal to add F&I managers to the licensing statute.
Virginia's initiative for a separate law covering F&I as a professional practice grew out of the F&I rate-packing scandals that beset publicly-owned dealerships in Tennessee and Florida two years ago. Minority-group plaintiffs accused F&I managers at a Toyota dealership in Memphis of charging them higher rates than non-minority vehicle buyers.
Captive lenders of major auto makers and publicly-owned megadealers capped their markup rates at the 2.5%-3% levels in the aftermath of the highly publicized discrimination suits, which included a segment aired on CBS's 60 Minutes new magazine show.