At this year’s NADA Show in Las Vegas, our Director of Compliance Terry O’Loughlin
sat down for a candid conversation about the state of automotive compliance, making it clear that the burden on dealers isn’t going away – it’s growing.
Terry brings a wealth of experiences to the podcast table. With nearly 40 years in automotive compliance and a place in the F&I Hall of Fame, his is a perspective few can match. So, when he joined Greg Uland, Reynolds and Reynolds VP of Marketing, in the Connected Podcast booth, people stopped to listen.
Shrinking federal footprint, growing state response
The pullback of federal agencies continues to be one of the most significant shifts in the current regulatory environment. The CFPB has been scaled back under the Trump administration, and the FTC’s reach has been restrained. However, O’Loughlin was quick to caution dealers against reading that as an easier road.
“The various other state agencies are coming to the fore, and they are trying to fill that void in every way they possibly can.”
States like California, Massachusetts, and Pennsylvania, where a “mini-CFPB” was established within its Office of Attorney General, are already proposing or enacting legislation.
The enforcement pressure hasn’t eased, it’s just shifted.
California CARS Act: Big changes in 2026
O’Loughlin provided a practical breakdown of what the California CARS Act means for dealers. At its core, the law demands full and fair disclosure at every point in the deal process.
Specifically, dealers can no longer display MSRP or advertise prices after rebates. The price shown to a customer must be the actual selling price, excluding only tax, title, and documentary fees. This applies to dealership websites, third-party marketplaces, brochures, and any other customer-facing communications.
One of the tricker practical challenges O’Loughlin highlighted was inventory pricing distributed to third-party sites through data feeds. If a dealer updates a price in the DMS but a marketplace site’s update lags by 24 or 48 hours, there’s a potential compliance exposure even if the dealer is acting in good faith. Addressing this workflow problem will be critical for every California dealer.
LAW’s Document Development Team is actively working with the California New Car Dealers Association (CNCDA) to develop F&I compliance documents aligned with the new law, taking effect Oct. 1, 2026. O’Loughlin’s message to California dealers: follow the protocol, use the right documents, and you’ll be in a strong position.
Recordkeeping: The overlooked compliance risk
O’Loughlin dedicated considerable time to a compliance issue he feels often flies under the radar – recordkeeping. The California CARS Act imposes a two-year recordkeeping requirement, and he was blunt about how easily dealers could have their recordkeeping used against them between the amount of documentation required and the length of time it must be maintained.
Before joining the LAW team, O’Loughlin worked for the Florida Attorney General’s Office, where he focused on prosecuting car dealers. His unique experience on the other side of the road taught him that most cases are built on documents – or the lack of them. Missing records don’t just create gaps, they create liability.
The answer isn’t simply storing documents, whether paper or electronic, it’s maintaining an auditable, consistent process. O’Loughlin strongly suggested that dealers establish formal disclosure protocols and use them to regularly inspect their compliance processes. A well-executed deal that is poorly documented can still become a risk.
Documents provide best defense
O’Loughlin wrapped up the conversation the way he often does, talking about the power of the document.
“We follow the law explicitly when we draft documents. It’s always minded: how can we protect dealers from any possible violation?”
Every LAW document is crafted with that question in mind. Dealers nationwide trust LAW documents because of the significant amount of time and effort that goes into creating these necessary tools that help protect dealers and dealerships.
Looking ahead
The regulatory landscape will continue to evolve. California likely won’t be the last state to act. Dealers who prioritize full and fair disclosure, build strong compliance protocols, and rely on quality F&I documents will be in the strongest position to weather whatever comes next.
Don’t wait for a regulatory audit to find the gaps in your compliance. Contact us today to schedule your free F&I Document Review.