700Credit’s recent industry-wide survey assessed dealer compliance with consumer data and fraud knowledge.
The survey inquired about dealers’ processes for securing consumer data during drive tests, obtaining copies of driver’s licenses, placing copies in the deal jacket and fraud scenario challenges.
700Credit Manager Director Ken Hill said, “The results of this survey are a wake-up call for the RV industry. It is clear that many dealers are still not adequately prepared to properly manage sensitive consumer data privacy, nor are they equipped to combat sophisticated fraud techniques. We urge all RV dealers to reassess their security protocols and implement more robust identity verification systems.”
Increasing data protection responsibility has accompanied the industry’s growth over the past decade. Not following data privacy law procedures may create data breaches or increase synthetic identity fraud, consisting of and false information.
The survey revealed the following results:
Capturing Driver’s License Data
According to the survey, 17% of dealers store driver’s license copies in an electronic deal jacket, while 50% are still using paper deal jackets. More than 50% of dealers are either making paper copies of licenses, taking a picture of licenses with employee’s phones or having consumers email copies to employees. The provider said, “These trends are alarming, and both speak to the lack of consumer data privacy per Safeguards Rule mandates.”
Synthetic Fraud Awareness
More than two-thirds (67.1%) of respondents are familiar with synthetic fraud, while only 25% understand how synthetic identities are created. One-third (33%) of dealers are unfamiliar with synthetic fraud, suggesting an industry knowledge gap.
Vehicle Theft
Nearly a third (30.3%) of dealers reported having an RV stolen due to fake identity or synthetic fraud in the past 12 months. Nearly a quarter (21.3%) of dealers experienced RV theft due to key fob swaps within the same period.
Test Drive Security
A quarter of dealerships require salespeople to accompany consumers on all test drives, while another 32% said they “sometimes” accompany on test drives. More than a quarter (27.6%) do not require accompaniment.
Identity Verification Practices
More than a quarter (26.3%) of dealers still rely on photocopies of driver’s licenses for test drives. Around 4% validate driver’s licenses against Department of Motor Vehicles (DMV) databases.
Financial Impact
Approximately 18.4% of dealers had to buy back at least one RV from their lender due to a fraudulent loan application in the past year.
According to 700Credit, “These findings underscore the pressing need for enhanced
security measures and fraud prevention strategies in the RV industry.”
The provider said synthetic fraud and vehicle theft prevalence reveal vulnerabilities that could lead to drastic dealer financial losses. The company asked dealers to invest in identity verification technologies, enhance fraud detection training and implement stricter driver’s license collection procedures and test drives.
