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Agent Summit 2016 Motivates and Inspires


On May 9, agents, agent principals, executives and trainers convened at the Venetian Palazzo in Las Vegas for Agent Summit 2016. The event, which attracted about 1,000 industry professionals, included more than two full days of educational sessions, networking breaks, meals and receptions.

As in years past, the agenda was built upon the agency and dealer development sessions the event has become known for. Many of those workshops and panel discussions will be covered in detail in upcoming issues of this magazine. In this article, we will take a closer look at some of the speakers, sessions and networking opportunities that were unique to this year’s show and left a lasting impression on attendees.

Agent Principals Only Breakfast & Roundtable

Last year’s Agent Summit included the first Agent Principals Only session in the event’s brief history. It was such a big hit, organizers decided to expand its time slot and move it to the very beginning of the agenda.

The Agent Principals Only Breakfast & Roundtable began at 8:30 a.m. on Monday, May 9, with a half-hour breakfast. Agent principals in attendance were seated with owners of other agencies of like size and encouraged to discuss common opportunities and challenges.

Mike Godin, owner of Godin Dealer Services in Albuquerque, N.M., had one complaint about the breakfast: It wasn’t long enough. As the owner of a small agency, he says he attends Agent Summit to pick up new strategies for business development and values the opportunity to spend meaningful time with his peers.

“In an open forum like that, you tend to get two or three people who ask questions of the advisers up there, and sometimes it seems that it mostly applies to what the larger agencies are doing,” Godin says. “So sitting around a table with other agents and agencies of like size, to me, proved more beneficial.”

The breakfast was followed “From the Box to the Brand Sign, a 47-Year Journey,” a rousing address from V. Andy Gill, who began his automotive industry career in 1969 as one of the country’s first F&I managers. Gill would go on to form an agency, buy and sell three new-car dealerships, and, last year, join a mergers and acquisitions firm. Along the way, he has collected a lifetime of stories, many of which he shared with the Agent Summit crowd.

The Agent Principals Only portion of the agenda concluded with a panel comprised of Randy Crisorio, chief executive of United Development Systems (UDS) and chair of the Agent Summit advisory board, John Braganini of Great Lakes Companies, Joel Kansanback of Automotive Development Group (ADG) and Dealer Commitment Services’ Glen Tuscan. The high-powered group touched on a number of issues relating to agency ownership, hiring and recruiting, dealer acquisition, regulatory compliance and more.

“Agent Summit is one of the few opportunities in the F&I industry where you can meet and collaborate with all of our colleagues and competitors in one collegial setting,” says Tom O’Neil, owner of O’Neil Financial Services Agency, an Agent Summit regular and a panel moderator at this year’s event. “Everyone seems to let their natural guard down to enjoy the sharing of information and camaraderie.”

“I always find two or three issues that come down the line I haven’t thought of, seen yet, done yet,” Braganini adds. “The agents are always interested in sharing what they’re doing. Nobody seems to have any secrets anymore.”

Dave Anderson and David Horsager

On Tuesday and Wednesday morning, Agent Summit attendees were treated to stirring motivational addresses delivered by Dave Anderson, president of Learn to Lead, and David Horsager, bestselling author of “The Trust Edge.”

“I loved all the sessions. I especially loved the hired speakers, Dave Anderson and David Horsager,” says Brian Crisorio, UDS’s vice president of marketing. “Their message goes beyond success in the workplace and can have positive effects on life in general.”

Anderson’s address, which was sponsored by EasyCare and GWC Warranty, began at 9:10 a.m. on Tuesday, March 10. In “How to Master the Art of Execution,” Anderson didn’t draw exclusively from his experience in the auto industry — which includes management of several highly successful dealerships — choosing instead to touch on themes applicable to any business, personal goal or charitable endeavor.

“Dave Anderson is obviously one of our favorites. He just gets the point across quickly and efficiently,” says Larry Dorfman, CEO of APCO and the EasyCare brand. “He always causes me to look in the mirror and be honest regarding how well I am holding myself accountable to help others be accountable.”

“Anderson was terrific, no question,” adds Greg Gomer, president and owner of Boston-based Finance Solutions LLC. “He is always a pleasure to listen to.”

On Wednesday morning, David Horsager took to the stage to deliver “The Trust Edge,” a fast-paced, high-energy rundown of the principles behind his bestselling book of the same name. Horsager explained how trust is a precious commodity that can only be mined through honesty, accountability and gratitude.

“Listening to David Horsager speak, I couldn’t help but think about all my closest friends and business partners and the amount of trust equity we have built in each other,” says David Gesualdo, Agent Summit show chair and publisher of Agent Entrepreneur and F&I and Showroom. “I imagine everyone in the room felt the same way. It was an incredibly moving session.”

NADA’s Andrew Koblenz

What interest do agents have in regulatory compliance? Plenty, according to Andrew Koblenz, a longtime National Automobile Dealers Association (NADA) executive who currently serves as the organization’s executive vice president of legal and regulatory affairs and general counsel. For as long as agency revenue is driven by the sale of F&I products, there will be a pressing need for agents to help dealers create, implement and maintain processes that are compliant with the maze of regulations enforced by federal regulators such as the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC).

“The session on compliance was extremely helpful as our business development managers look to assist the dealers in the educational process,” said Rod Heasley, president and CRO of KISS Concepts Group in Fairmont, N.C.

Koblenz presented “Solving the CFPB and Fair Credit Risk Problem” at 10:30 a.m. on Tuesday. His presentation, which was followed by a lengthy question-and-answer session, included a review of recent regulatory actions, steps banks and finance companies have taken to mitigate or eliminate risk, and new rules agents and dealers should follow. By acknowledging the CFPB’s concerns and self-policing, Koblenz argued, the industry can remain compliant while preserving the F&I process — which is of benefit to car buyers as well as retailers and providers.

“The whole industry should be taking note of what the agent brings as far as profitability, compliance and training. They deserve more recognition,” Tuscan says. “It’s great being surrounded by people who have their fingers on the pulse. I can’t get enough.”

Technology Sessions

Several attendees identified the two technology-focused sessions as among the most memorable of this year’s show. The first, “Next-Level Product Sales,” was delivered by Mike Burgiss, founder and general manager of MakeMyDeal, on Monday afternoon. It was followed by “Technology on the Move — New Horizons,” a panel discussion helmed by Randy Pazik, president and owner of Accelerated Profit Technologies.

“Certainly the sessions on technology are beneficial, because that’s a moving target,” Godin says. “We need to know how the providers are developing it and employing it in dealerships.”

Burgiss, who is an advocate of making more information about F&I products available online, says he realized speaking about a topic that can spur heated debate would be a challenge.

“As someone that’s focused on technology, I often get misunderstood as someone portraying the idea that technology can replace face-to-face interaction,” he says. “There’s no replacement for live interaction, just like there is no replacement for a live business manager in the sale of a vehicle and its associated aftermarket products.”

Instead, he argued, bringing parts of the F&I process forward can improve production by helping the finance office keep pace with the rapidly changing demands of car buyers. He says the agents in attendance offered “good engagement” and were receptive to his message, and the reviews back him up.

“Hearing the presentation from Mike Burgiss and speaking with other technology providers, it is clear that those guys are really working hard to stay on top of their game,” Brian Crisorio says. “Several years ago, the reaction would have been, ‘We don’t have to worry about that.’ The best point I’ve heard is the drive to put good information about F&I products and pricing online. If you don’t, all your customers are going to see are the complaints and negative information.”

Burgiss was immediately followed by “Technology on the Move — New Horizons,” for which Pazik was joined by StoneEagle’s Thomas Elliott, Kumar Kathinokkula of F&I Administration Solutions, Tony Luciano of Allstate Dealer Services, MaximTrak’s Jim Maxim Jr. and Carrie Profaizer of Protective Asset Protection.

In addition to discussing their companies’ latest efforts in the dealer technology space — including the showroom as well as the finance office — panelists discussed how the role of F&I professionals could change and grow.

“We heard in this exchange the same conversation that plays out in dealerships across the country,” Burgiss says. “The debate emerges between meeting consumer expectations through the use of online experiences versus the potential loss of control. Using technology as a communication platform leads to more engaged consumers who will buy more, and most importantly, allow dealers to maintain control of the deal structure and better manage their profitability.”

Networking and Exhibits

Demand for meeting space and exhibition opportunities forced organizers to open up the show’s floorplan by booking 13 private meeting rooms and opening a separate exhibit hall. Attendees agree the moves took the event’s networking opportunities to the next level.

“I think the show, every year, seems to step up and get better,” Godin says. “Certainly the venues are great and the separate exhibit hall was great. I would expect most of the exhibitors liked it.”

“If you had nothing but that, I could go out on that floor and, in two hours, I could talk to everybody that matters in our industry,” Braganini says, adding that he connected with 10 new providers in the expo hall and spoke with a number of industry professionals who were in transition and looking for their next opportunity. Finally, he adds, he picked up on a new theme: “The agent channel is consolidating, quickly.”

Gomer agrees, noting that it was “amazing” to hear how many attendees were looking for agencies to acquire.

Asked whether the new contacts he made justified the cost of the trip, Dorfman says he doesn’t measure Agent Summit in terms of immediate returns.

“We made some great contacts and have continuing conversations going on with some new opportunities, so that’s great,” he says. “Just as importantly, we had some valuable time to meet up with current partners and others we know and spend some time talking about the business.”

“This is such a small fraternity of F&I agents that the meeting feels more like a reunion,” O’Neil adds. “It is always interesting to see where everyone is coming from and where their businesses will be going forward.”

Braganini agrees, noting that the event offers agents of any size a unique opportunity to keep pace with their partners and competitors in a business that has, in recent decades, been subject to sweeping changes at every level.

“If you don’t go, you reposition yourself in the industry and in the overall food chain. Our industry is highly dynamic. It’s constantly changing,” Braganini says. “You can look to printed media and email and different things like that as a source of maintaining your level of awareness, but there is no substitute for spending three or four hours talking to your peers and your providers. … When I go, I don’t know where or why it happens, but I always leave with three or four takeaways that pay for the trip 25 times over.”

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NADA’s Koblenz to Shed Light on CFPB at Agent Summit


LAS VEGAS — Andrew D. Koblenz of the National Automobile Dealers Association (NADA) will speak at the upcoming Agent Summit and provide attendees with insights into the Consumer Financial Protection Bureau (CFPB)’s regulation of the auto finance market, organizers announced Monday. The sixth annual event will be held May 9–11, 2016, at the Venetian Palazzo Las Vegas.

“Understanding the trajectory of the CFPB’s activity regarding the auto finance market is critical to understanding the current regulatory environment in which we find ourselves,” Koblenz said. “It’s also a vital part of evaluating those concrete steps that dealers and lenders can and should be taking in the face of this new regulatory reality.”

Koblenz currently serves as executive vice president of legal and regulatory affairs for NADA, and also oversees the organization’s economic and research department. He is a frequent speaker and valued source for a number of industry events and publications.

At September’s Industry Summit, Koblenz presented “Solving the CFPB Problem,” a comprehensive review of actions undertaken by the CFPB, the effects of those actions on the industry and what the future holds for the oft-maligned agency. He is expected to touch on similar themes at Agent Summit.

“Andy never fails to connect with his audience, because he approaches the topic of compliance with hard-won expertise and disarming humor,” said David Gesualdo, show chair and publisher of Agent Entrepreneur and F&I and Showroom magazines. “He understands both the seriousness and absurdity of the CFPB’s efforts. He is the ideal speaker for a key topic at a critical juncture.”

Registration for Agent Summit is now open at the event’s website as well as by phone, fax and email. Attendees who register by April 4 will enjoy a $100 discount. To inquire about sponsorship and exhibition opportunities, contact Eric Gesualdo via email hidden; JavaScript is required or call 727-612-8826.

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The Dodd-Frank Act: The Creation of the CFPB and How it Impacts F&I


One of the sessions that garnered a lot of attendance and attention at the Industry Summit show at the Paris Hotel and Casino in Las Vegas last month was the Dodd-Frank panel, moderated by Bob Harkins, vice president/director of training, AFG Training Academy; president, RAH Consulting. It tackled subjects such as the Consumer Financial Protection Bureau (CFPB) and other regulatory bodies that impact the F&I office across the board.

As outlined by the panel, the Dodd-Frank act was signed into law in July 2010, and that set into motion the creation of the CFPB, which is the federal agency “causing the most uproar in recent memory”. It was officially created in July 2011, and currently has approximately 1,400 employees – about 700 of whom are attorneys. The problem, and the cause of much anxiety throughout the F&I industry, is that the CFPB has issued only vague, general statements, but hasn’t provided any concrete rules or guidelines that dealers, agents and providers can follow. This leaves a legal “grey area” with everyone uncertain as to what is expected of them.

“It’s been a very interesting trip for us,” said Damon Wiener, senior vice president and general counsel, Safe-Guard Products International LLC. He went on to compare it to a marriage – “They claim they have authority over me, they won’t tell me what the rules are, but they punish me when I break them,” he said, to laughs throughout the room.

Nicole Munro, partner, Hudson Cook LLP, agreed, noting that the CFPB is impacting her legal practice every day. While Wiener compared it to a marriage, she used the analogy of a two-year-old on a sugar high, noting that the agency might be young, but it’s been very, very active. “You should be very prepared for their intervention,” she noted.

Part of the reason the CFPB is so active, and something to be concerned about, is that it is extending and augmenting it’s authority by incentivizing the state Attorney Generals, noted Terry O’Loughlin, director of compliance, Reynolds and Reynolds. He explained that the Attorney General doesn’t have the same limits that are in place to constrain the CFPB, so the agency is encouraging them to adopt and prosecute its policies, extending its reach.

The key to staying out of trouble, noted Dave Robertson, executive director, Association of Finance & Insurance Professionals (AFIP), is to take a proactive approach – dealers, agents and providers should all be looking at the F&I process and asking themselves what can they be doing on a day-to-day basis to stay in compliance.

One of the key points the CFPB is targeting is the issue of dealer compensation and the ability for dealers to price credit. “The CFPB has agreed that dealers should be compensated, but the debate is how they get compensated,” said Andrew Koblenz, executive vice president, Legal and Regulatory Affairs, and general counsel, National Automobile Dealers Association (NADA). His agency has been one of the industry players looking to educate the CFPB, among others, on how dealer compensation works, and why it is important. At first, he said, they were looking at the possibility of eliminating it altogether, but once it was explained how it adds value to the consumer, and provides access to credit that many consumers would not otherwise have had, they were persuaded not to slash compensation completely. Now, however, it is trying to find the middle ground where dealers are compensated fairly, and consumers are protected from unfair practices.

The agency is also targeting “unfair or deceptive” advertising, which is where the vagueness comes in. They have not clarified what “unfair or deceptive” means, but they have issued orders noting that dealers should avoid them. When there are no clear-cut actions to avoid, what should the industry be doing? First, Munro, noted, providers and dealers need to look at each product and classify exactly what it is in each state – is it a vehicle service contract (VSC), warranty or insurance product? Then, she noted, examine whether that state’s law allows the financing of that type of product, and if so, how it needs to be disclosed. “The problem is in characterizing it,” she said. “Since if you get that wrong, everything else could be wrong too, and you might have violated state laws.” The challenge gets even harder when bundled or combo products start to come into play – she gave the example of adding an insurance product to a bundle of non-insurance products – and noted that it varies as to whether that changes the classification of the other bundled products as well. “You may only know you have an insurance product when you get a violation,” she said.

“Agencies prefer to be unclear,” said O’Loughlin. “Because it forces their targets to overreact, to overcompensate. It’s a great result, because it makes the industry more fearful of what else they might do.”

“There’s a lot of uncertainty out there,” said Wiener. “Everything right now is mostly speculation.” He did go on to note that while the orders have started to at least frame what the CFPB is looking to do, we are still in the early days of figuring out exactly what that is. He did say that the agency does not seem to be attacking the value of the products themselves – they are focused instead on how they are marketed to consumers. However, that does not change the need to make sure the product itself is compliant with all state laws where it is being sold, and that the sales practices themselves are buttoned-up. “We need to be careful, and pay attention to nitpicky details,” he said.

It also goes back to that jurisdictional issue that O’Loughlin pointed out – at the end of the day, what authority does the CFPB actually have, and what actions do they have available to enforce them? Munro does not believe that, legally, the agency has the jurisdiction to regulate product or service providers directly – but she believes it will be a fight to prove that and keep the agency out of this area. “I believe anything offered equally in cash or finance should be outside their jurisdiction,” she said.

“They will try to overreach, and we will have to push back,” agreed Koblenz.

Words Matter
While the CFPB orders might be vague, the panel agreed that they matter, and they will have an impact going forward on the ancillary products offered in the F&I office. O’Loughlin believes the impact will be more far ranging than just products, however. “They will issue very harsh demands, and will conduct audits where they collect tremendous amounts of data. The CFPB is going to share sensitive information [with state Attorney Generals] to identify patterns and practices – and that is a menacing prospect.” The problem is that the CFPB can gain access to sensitive information that the Attorney General could not have otherwise obtained without a subpoena. That worries him; right now, not all of the Attorney Generals are signing on to work with the CFPB, but he believes it is only a matter of time – there is too much money to be made for the state, he noted. The CFPB allows them to enact much higher penalties than the Attorney General could alone, and he does not see them refusing to go that route for long.

Munro noted that while the agency does not have direct access to dealers today, she agrees that the access to data is the most concerning. “They cannot go into a dealership [and collect information],” she noted. “But they can find information about the dealership through the sales of finance products, and pass that along to the Attorney General.”

However, cautioned Koblenz, there are limits. He noted that, like Munro, he sees jurisdiction issues coming into play, as to what the CFPB can and cannot do, and where their authority extends, and that could limit the effectiveness of their strategy in the future.

Disparate Impact – Where Does That Come Into Play?
One of the ways the CFPB is targeting dealers and providers is to claim disparate impact – which is when they go back and look at deals already made, and use an algorithm to determine if they believe discrimination happened. The problem is that it is illegal to collect information such as race when filling out loan or credit documents. So agencies like the CFPB use information such as the U.S. Census, or surnames, to try and assign race or gender. But, agreed the panel, that process is flawed. It can be misleading at best, and plain wrong at worst, leading the agency to make policies to prevent unintentional discrimination that, the panel noted, might not even exist in the first place.

“They have to look at other factors,” said Koblenz. “Things like credit risk – it costs more to place a subprime loan, regardless of race. And there are other variables such as inventory, the amount financed or the term of the loan.” A better metric for determining if everyone was treated fairly, he said, is to look at the dollars – if the goal is to have every deal generate approximately the same dollar amount, then the rates will be all over the place, based on all those credit and financing factors – race doesn’t play into it. Everyone is treated equally, based on their financial standing.

The frustration over disparate impact, Wiener noted, is that the CFPB is preaching transparency in all transactions to ensure every customer is treated equally and fairly – but at the same time, they are refusing to release the metrics they used to determine that there was discrimination in the first place. It is a double standard that leaves dealers, agents and providers to develop compliant policies, only to have to constantly keep adjusting them as the CFPB releases new bits of information.

“They’ve given us little information on how to code these loans,” said Munro. She pointed out that there is currently a case before the Supreme Court that might make it a moot point – the case is seeking, among other points, to have the court rule on whether disparate impact is a valid legal theory. She believes the case will eventually do away with disparate impact completely, which will change the entire conversation around the CFPB completely, yet again.

At the end of the day, the CFPB is impacting F&I today, and will continue to have an impact in the future. But exactly what that impact will be long term, not even the panel could say for sure. There are still too many variables in play, and not enough information to go on – the best policy for anyone in the industry is to stay vigilant and create clear, understandable policies that apply to every loan and every product that is sold through the dealership – so even if a violation is cited, there is a clear paper trail showing the intent to be compliant and stay within the law.

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