Unlawful Dealer Activities
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Misuse of Special Plates
Misuse (or permitting unlawful use) of Special Plates (known as Dealer Plates) is cause for Administrative Actions including license suspension.
Lending Dealer supplies or Permitting Misuse of License or books
It is unlawful for any licensee to allow the use of their Dealer’s license, supplies, or books by any other person for the purpose of permitting that person to engage in the sale of vehicles.
Never share or loan your Dealer license, supplies, or books.
A valid License or Permit issued by the DMV is required by any person acting as a Dealer at any of its branches, including temporary branches.
Dealers may not display a vehicle for sale at a location other than their established place of business, authorized by the department.
It is unlawful for any licensed salesperson to perform the sales activities at any location other than the employing Dealer’s licensed location.
Dealers may not employ a person as a salesperson who has not been licensed and whose license is not displayed on the premises of the Dealer.
Dealers are required to notify the department by mail within 10 days of the employment or termination of employment of a salesperson.
Failure to pay Administrative Service Fee (ASF) when due
Dealers must pay ASF fees when due.
Failure to pay could result in additional fines, action against your Surety Bond or a suspended license
Submission of dishonored check to Department
Submitting a check, draft, or money order to the department for any obligation or fee(s) due to the State which was dishonored or refused payment upon presentation could result in administrative action.
Failure to Transfer Title
Dealers are required to complete the title transfer to the purchaser within 40 days for a new vehicle or 50 days for a used vehicle.
Failing to transfer the title within this time would result in a fine (ASF Fee) and possibly a suspended license.
Bait and Switch
Bait and Switch” advertising is illegal and occurs when a Dealer offers for sale or advertises a vehicle for sale that in truth, the Dealer does not intend to, or want to sell.
Never advertise or offer for sale or exchange unless the vehicle is:
- Actually for sale
- Available to the Dealer directly from the manufacturer at the time of the advertisement or offer
CVC Section 11713 Section 238, Title 16 of the Code of Federal Regulations
Bird Dog Fees
It is unlawful for any licensed Dealer to pay a “referral” or a “finders” fee to any person who directs a potential customer to a Dealer unless they are a Salesperson, licensed by the Department, to the De2aler.
CVC Section 11800
Confidential Computer Dealer Records
Consumer information gathered during the operation of your Dealership is confidential and may not be shared with any individual or company.
Sharing consumer information is a criminal offense and will lead to administrative action.
- Occupational Licensing & Business Regulations
- VC 11713.1 Dealer License; Violations
- Guide for Licensed Vehicle Dealers and Lessor-Retailers (OL40)