Patriot Act Alters America’s Business
On October 26, 2001, the President of the United States signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot) Act of 2001. The new legislation is designed to strengthen law enforcement’s ability to investigate and penalize money laundering and disrupt terrorist financial networks.
The Act clearly applies to any business that is “engaged in vehicle sales.” The cash reporting, information sharing and anti-money laundering programs covered in the Act certainly affect all dealerships.
While the industry has been given a short extension to implement the Act, Kelly Enterprises has taken the stance that being proactive and informed is the best course of action. We wish to share with you the information that we have been able to glean from several sources.
The Patriot Act was first brought to our attention in the December/January issue of F&I Management & Technology. Our F&I 20 group members have since investigated the directive and solutions. From further communication with the Recreational Vehicle Dealer Association (RVDA) and information gleaned from NADA Convention in San Francisco, we have developed the following guidelines.
OFAC Alert
Jan Kelly wants to make sure that your dealership conforms to the Patriot Act. You must check every customer that buys/leases a unit against the OFAC list, also known as the “bad guy” or “Blocked Persons” list. There is discussion that dealerships may not have to comply with the act since all of the people on the list are located outside the USA. But, until it is finalized, Kelly Enterprises recommends that you comply. There are stiff penalties for non-compliance.
There are three ways to check the list.
1. Contact your credit bureau(s), phone numbers are below, and tell them you need an OFAC addendum. Sign the addendum, return to bureau with request to “turn on” the OFAC list check. From this point forward, each time you request a credit report, the bureau will automatically check and see if the name appears in the OFAC list. The results will be noted on the credit report.
Equifax – 888-853-5099
Experian – 800-831-5614, option 3, or email: kathryn.green@experian.com and request the OFAC addendum.
Trans Union – Call your local sales rep or go to web site, www.transunion.com , and fill out the product information request form and a local representative will contact.
Credco – Call Kathy Camacho @ 800-691-1414 x 6817
2. Use the following web address: www.treas.gov/offices/enforcement/ofac/sdn/t11sdn.pdf (after the t and before the sdn are two ones, i.e. an eleven, and NOT the letters “l”)
When you click on the above address it will automatically download the file. Open it up. You must have Adobe Acrobat 4.0 or higher to open/read the file. The file is 75 pages long. Scroll through and see if the name of your customer is on the list. If the customer’s name is on the list then you CANNOT sell or lease them a unit until you confirm that your customer simply shares the same name or is, in fact, not the person on the OFAC list.
If the customer’s name is NOT on the list, then print the page the customer would be on plus a page on either side and keep as a record of your due diligence. Printing the 3 pages works well for cash customers since you cannot pull a credit report on them.
Download a copy every day since it is frequently updated.
3. An easier method than number 2 above. Go to www.OFACcompliance.com. Input customer name in upper right corner of home page. Web site will return OK or not. Print page for records. This way you don’t have to search through the fine print of the actual list.
For additional information read the article in F&I Management & Technology, “Uncle Sam Wants You to Fight Terrorism”, Lovoy, Elena A. & Teresa L. Rohwedder, December 2002/January 2003, p. 30-33.
You can also contact Christy Sharn, RVDA’s State Communications manager at csharn@rvda.org or call the RVDA dealer services hotline.
World of Special Finance, March 2003, pp.18, 19.