Vehicle remarketers have been pushed to follow more and more regulatory compliance procedures for financial institutions and other consignors while handling wholesale vehicle sales, ServNet's CEO told Vehicle Remarketing Reporter.
Because auctions are downstream vendors from finance companies, they often have been asked to help their customers follow increasingly strict regulations imposed from the federal government, ServNet's Pierre Pons said.
"Our auctions must help their customers meet these compliance rules," Pons said. "It can be onerous."
ServNet's independent auctions have more frequently been asked to agree to detailed contracts that can run as long as 100 pages in order to continue receiving vehicles from the institutions, Pons said.
Auctions are also now being asked to wipe away personal data that's been embedded into vehicles, such as smartphone contact directories, home and work addresses in navigation systems, and garage door or gate codes programmed into memory buttons. Repossessed vehicles present the thorniest challenge, because the debtor has time to reclaim the vehicle, so the vehicles will often sit in auction lots. Fleet management companies may not remove this private information after they recover the car from an employee, leaving auctions to dedicate time and staff to something they aren't compensated for, Pons said.
"We're just remarketing vehicles, so we're not used to this kind of scrutiny," Pons said.
Compliance has been a hot topic at remarketing industry events such as the Conference for Automotive Remarketing and International Automotive Remarketers Alliance (IARA) roundtables.
IARA is putting together a compliance committee led by Tim Meta, the national remarketing manager of Fifth Third Bank. The committee will seek to bring together remarketers and vendors such as repossession agents, transport companies and automotive auctions to work together to streamline processes and create consistencies, Pons said.