Auto dealerships collect some of the most sensitive information from consumers. From social security numbers to financial data, the personal information that passes through your dealership requires rigorous protection. With multiple regulations to navigate and severe penalties for non-compliance, dealers need a clear roadmap to privacy and safeguards compliance.

Let’s take a look at the 10 essential steps that every dealership should implement to protect customer information and comply with regulations like the Gramm-Leach-Bliley Act, the FTC Safeguards Rule, the Red Flags Rule, and emerging state privacy laws.

Meet Our Privacy & Safeguards Expert

Leading us through this journey is KPA’s experienced Privacy and Safeguards professional. Adam Crowell is KPA’s VP of Legal and Corporate Development. He’s a licensed practicing attorney and nationally recognized compliance expert and speaker who regularly contributes to a variety of compliance and risk mitigation subjects. He brings to KPA over 21 years of legal experience and thought leadership for the development of strategic relationships and solutions for proactively avoiding claims, fines, and lawsuits.

Why Privacy and Safeguards Compliance Matters

Before diving into the steps, let’s understand what’s at stake. Non-compliance isn’t just a regulatory issue—it’s a business risk that can result in:

Severe financial penalties: Violations can be considered unfair and deceptive acts under Section 5 of the FTC Act, carrying penalties of over $55,000 per violation. With multiple consumers affected, penalties can quickly reach millions of dollars.
Reputational damage: Data breaches and privacy violations erode customer trust and can permanently damage your dealership’s reputation.
Operational disruption: Regulatory investigations and remediation efforts divert resources from your core business operations.

The 10 Steps to Privacy and Safeguards Compliance

Follow a 10-step journey to compliance.

Move your mouse over each step to learn more about each step.

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The 10 Essential Steps to Privacy and Safeguards Compliance

Here’s a preview of the critical steps we’ll explore in detail over the coming weeks:

Establish a Privacy and Safeguards Team

Assemble a dedicated team including a Privacy Officer/Qualified Individual and information security personnel who will implement, oversee, and enforce your written information security program.

Who should be on your team

Conduct Written Risk Assessments

Document initially and periodically what customer information you collect, how it’s stored, who accesses it, and identify potential risks and various safeguards as the foundation for your security program.

How to conduct an assessment

Develop a Written Information Security Program

Create a robust, dealership-specific program with administrative, technical, and physical safeguards that establishes clear roles and responsibilities for protecting customer information.

Implement Comprehensive Training

Provide role-specific information security awareness training to all employees who access customer information, covering privacy laws, safeguards requirements, and proper information handling from receipt through destruction.

Conduct Phishing Penetration Testing

Test your team’s security awareness through simulated phishing exercises to identify vulnerabilities and provide targeted remedial training where needed.

Establish Vendor Management Protocols

Select vendors capable of safeguarding customer information, establish contractual protections, and regularly assess their security practices to extend your safeguards responsibilities to all service providers.

Implement Access Controls

Ensure customer information is only available to those with legitimate need, with all access logged and monitored, and implement clear data retention and disposal policies.

Develop IT Technical Requirements

Implement mandatory technical measures including encryption, multi-factor authentication, and continuous monitoring or regular testing to protect customer data and detect potential intrusions.

Create an Incident Response Plan

Develop a clear plan that guides your team through detecting, responding to, recovering from, and remediating unauthorized access to consumer information while meeting regulatory

Prepare Annual Reports

The qualified individual must prepare a written annual report for leadership that documents risk assessment, management strategies, testing results, and security responses to ensure accountability and demonstrate compliance.

How KPA Helps Dealers with Privacy and Safeguards Compliance

KPA’s Privacy and Safeguards Solution provides dealerships with the tools and expertise needed to navigate the complex landscape of privacy regulations. With KPA, dealers don’t have to face these challenges alone.

Our comprehensive solution helps you:

Develop and implement customized information security programs tailored specifically to auto dealerships
Provide role-based training and security testing to strengthen your team’s awareness
Meet technical requirements through vulnerability scanning, penetration testing, and security monitoring
Create and manage documentation including risk assessments, incident response plans, and required reports

As a trusted partner with deep expertise in automotive compliance, KPA combines easy-to-use software, comprehensive training, and expert consulting to help dealers reduce incidents, avoid violations, and lower business risks. Our team guides you through each step of the compliance process, ensuring you have the right safeguards in place to protect both your customers and your business.

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