PROPOSED REGULATION:  12-6-104(4)  ESTABLISHMENT OF ENFORCEMENT AND COMPLIANCE STANDARDS RELATED TO ADMINISTRATIVE PENALTIES.

LEGAL BASIS FOR THIS REGULATION:  The statutory basis for this regulation is C.R.S. sec. 12-6-104(4) and Senate Bill 07-221

PURPOSE OF THIS REGULATION:  The purpose of this new regulation is to ensure that administrative penalties are equitably assessed and are commensurate with the seriousness of  the violation.  
   
12-6-104(4)  The Board shall apply administrative penalties in the cases it considers based upon the following compliance and enforcement standards:

1.  All matters brought to the Board for hearing shall be presented either electronically or in written hard copy by sworn affidavit asserting probable cause to believe that the events set forth in the affidavit constitute a violation of regulation or law which the Board is empowered to enforce.

2.  The investigation section of the Auto Industry Division in accordance with guidelines established in cooperation with the Board will determine whether or not the results of an investigation shall be referred to the Board by affidavit.

3.  No complaint shall be referred to the Board by the Auto Industry Division until such time as the Division has considered the licensee’s response to the complaint, if any, and had substantially completed its investigation into the matters alleged.

4.  A matter shall be referred to the Board whenever the following conditions are met:

	(a)  When the licensee has engaged in a pattern of violations.  A pattern for this purpose is defined as 2 or more founded complaints occurring within the preceding 12 months.  No matter resolved by a licensee based upon the 10 day letter program of the Auto Industry Division shall be considered for the purpose of establishing a pattern pursuant to this provision.

	(b)  When a licensee’s conduct appears to the Auto Industry Division to be willful and deliberate or the licensee’s continued conduct presents a clear and present danger to the public` health, safety or welfare.

	(c)   When the licensee and the complainant are unable to reach an acceptable resolution of an actionable complaint or when a licensee fails to present a reasonable offer to resolve a complaint.  

	(d)     When the Auto Industry Division determines that the conduct of any licensee is such that it cannot properly be corrected without the intervention of the Dealer Licensing Board.

5.  Upon presentation to the Board of a matter by the Auto Industry Division the Board shall dispose of all such matters upon its review and evaluation of the Affidavit of  Probable Cause by:

	(a)  The Board may accept the case for hearing and appoint itself upon unanimous vote, an administrative law judge or a hearings officer to hear the matter, as is appropriate.  In all such cases the Board shall refer the case to the Attorney General for the commencement of formal disciplinary proceedings, drafting of Notice of Hearing and Notice of Charges and prosecution of the case.

	(b)  The Board may direct the executive secretary to propose a resolution of the matter to the licensee, to attempt to enter into a stipulated disposition of the matter or to otherwise resolve the matter without a formal hearing.

	(c) The Board may refer the matter to another agency if appropriate.

	(d) The Board may refer the matter back to the Auto Industry Division for further investigation without taking any further action at that time.

	(e) The Board may determine not to exercise any authority over the matter and advise the Auto Industry Division that it declines to take any action and defers to the provisions found in section 12-6-122 C.R.S. , civil remedies.

6.  The Board shall, from time to time and as is appropriate and necessary agree with the Auto Industry Division to create and update compliance and investigation guidelines to be used by the Division for evaluating matters prior to referring them to the Board.  

7.  The Board shall impose administrative penalties based upon its discretion except that it may not exercise any discretion with regard to mandatory disqualifying terms and conditions established by statute.  Upon exercising its discretion the Board shall consider the licensee’s history with the Board and the impact of any monetary fine on the licensee’s ability to restore any victim to the status quo.

8.  Fines imposed by the Board shall be punitive and not compensatory.

9.  The Board may reduce any fine it imposes upon a licensee by any amount said licensee pays to victims in order to restore the financial loss suffered by victims subjected to the conduct of the licensee which conduct is the subject matter giving rise to the fine imposed by the board.

10.  Any licensee appearing before the Board for imposition of an administrative penalty for the first time shall be subject to 50% of the fining authority of the board (or its designee) as provided for in article 6, of title 12, CRS. In addition, the board shall also consider mitigating and aggravating factors when imposing administrative penalties. 

11.  Any licensee appearing before the board for imposition of an administrative penalty for a second time on the same or similar offense within a 24 month period shall be subject to at least 75% of the fining authority of the board (or its designee) as provided for in article 6, of title 12, CRS. In addition, the board shall also consider mitigating and aggravating factors when imposing administrative penalties. 

12.  Any licensee appearing before the board for imposition of an administrative penalty for a third or more occurrence of any fineable offense within a 24 month period shall be subject to the full fining authority of the board (or its designee) as provided for in article 6, of title 12, CRS.  In addition, the board shall also consider mitigating and aggravating factors when imposing administrative penalties. 

Proposed Amended Regulation: 12-6-104(3)(k).  Disclosure Form.

Basis:  The statutory basis for this regulation is 12-6-104(3)(k) C.R.S. and SB07-221. 

Purpose: The purpose of this amended regulation is that the board shall prescribe a form used as part of a motor vehicle contract.

     MOTOR VEHICLE/POWERSPORTS VEHICLE SALES CONTRACT

       DISCLOSURES REQUIRED AS PART OF A 

DR 2434 (09/17/07)
COLORADO DEPARTMENT OF REVENUE
AUTO INDUSTRY DIVISION
DENVER, CO 80261-0016
(303) 205-5604

Date of Sale 	
These disclosures are required by Colorado Law unless the buyer has already been given a copy of a completed retail installment sales contract that includes all disclosures required by federal and state laws. Initialing the provisions below incorporates them into your contract to purchase a Motor Vehicle/Powersports Vehicle. 		

Dealer/Agent’s 	Buyer’s 	
Initials 	Initials 	
A. 	IMPORTANT NOTICE: The papers you are signing as part of this Motor Vehicle/ Powersports vehicle sale  Vehicle sale are legal  documents. You should read them carefully and if there is anything you do not understand, you should seek legal assistance. 		

B. 	WARNING: Only the terms and conditions written into these documents are part of the contract. Be sure that any oral representations are also written into these documents otherwise they cannot be enforced.		
C. 	Any fraud or misrepresentation in a Motor Vehicle/Powersports Vehicle sale is punishable under Colorado State Law.		
D. 	The contract is for cash. It requires you to pay the dealer $______________, the total balance due after your trade-in and/or deposit(s) are deducted. Failure to pay this amount by ______________ may result in the loss of any deposit(s) you have paid and/or your trade vehicle.		
	OR		
	Dealer has agreed to arrange financing for you and you agree to buy the Motor Vehicle/Powersports Vehicle if financing can be arranged at an interest rate that does not exceed ____________% annual percentage rate. At this percentage rate your monthly payments would be _________ per month for _________ months, until paid in full, assuming a down payment or trade worth ____________. This annual percentage rate must be agreed upon by both you and the dealer. Also, you are entitled by law to complete, written disclosure of all the loan terms and the contract is not binding until you receive such a disclosure and accept the loan terms disclosed.		
               E.

   	You and the dealer have agreed that the vehicle will be delivered to you prior to the purchase price being paid in full. If financing cannot be arranged at the terms stated in the contract, and the contract is cancelled, you agree to pay the dealer $____________ dollars per day and ____________ cents per mile for your use of the vehicle from the date of delivery until the vehicle is returned to the dealer. If the contract is cancelled, it may require you to immediately return the vehicle to the dealer and to pay the cost of repair for any damage occurring to the vehicle while it is in your possession along with the agreed upon daily and mileage charges. The contract may also give the dealer the right to take the vehicle from you 24 hours after cancellation and demand for the vehicle’s return. You may also be required by the contract to pay any costs the dealer may have to pay in regaining possession of the vehicle. If you owe any money from daily and mileage charges, damage repair costs or repossession costs to the dealer when the vehicle is returned, the dealer may keep your deposit(s) up to the amount owed. Otherwise, the deposit must be returned unless you have agreed that it is non-refundable.		
The Colorado Motor Vehicle Dealer Board has the authority to investigate all complaints arising from the sale of a Motor Vehicle/Powersports Vehicle from a licensed dealer. Any complaints should be forwarded in writing to the Auto Industry Division on behalf of the Dealer Board to 1881 Pierce St. #142, Lakewood, CO 80214, or you may send via fax at 303-205-5977. You may visit our website at www.revenue.state.co.us/dlr/home.asp or contact us at 303-205-5604. 	
I hereby certify that I have received a copy of this I hereby certify that I have given the buyer a copy of this disclosure.
	I hereby certify that I have given the buyer a copy of this disclosure.	
Dealer/Agent’s Printed Name 	Buyer’s Printed Name 	
Dealer/Agent’s Signature 	Date 	Buyer’s Signature 	Date 	

Proposed Amended Regulation: 12-6-118(3)(d).  Define written notice to the Board of a conviction.

Basis:  The statutory basis for this regulation is 12-6-118(3)(d), C.R.S. and  SB07-221
 
Purpose: The purpose of this amended regulation is to give the board written notice within 30 days of a conviction.

REGULATION 12-6-118(3)(d). A dDealers, wholesalers, wholesale auction dealers, officers, directors or stockholders of corporations owning five per-cent or more, licensed as such, who is are convicted of or pled nolo contendere or a plea in a deferred judgment and sentence to any felony or any crime pursuant to Article 3, 4, or 5 of Title 18, C.R.S., or like crime pursuant to federal law or the law of any other state, must give shall provide to the Board written notice of such conviction within thirty days after receiving final judgment. The Llicensee is responsible for shall provideing complete information including copies of final judgments and pre-sentence reports within thirty days of the final judgment. 

Proposed Amended Regulation: 12-6-118(5)(b). Define material misstatement in a salesperson application.

Basis:  The statutory basis for this regulation is 12-6-118(5)(b), C.R.S. and SB07-221.

Purpose: The purpose of this amended regulation is to define material misstatement in a salesperson application.

REGULATION 12-6-118(5)(b). “Material misstatement” in an application for a salesperson license means any material false or misleading statement, omission, or misrepresentation regarding personal identification information, employment history, prior occupational licensing history, whether regarding a license issued by the Board or any other licensing/regulatory agency, criminal background and history including arrests, criminal information filings, indictments, municipal, misdemeanor, and/or felony convictions, plea of nolo contendere and a plea in a  deferred judgment and sentence and deferred judgements.

Proposed Amended Regulation: 12-6-118(5)(j).  Define written notice to the board of a conviction.

Basis:  The statutory basis for this regulation is 12-6-118(5)(j), C.R.S. and SB07-221.
 
Purpose: The purpose of this amended regulation is to define written notice to the board of a conviction.

REGULATION 12-6-118(5)(j). A  salesperson who is convicted of or pled nolo contendere or a plea in a deferred judgment and sentence to any felony or any crime pursuant to article 3, 4, or 5 of title 18, C.R.S., or like crime pursuant to federal law or the law of any other state, must give the Board written notice of such conviction within thirty days after receiving final judgment. The Llicensee is responsible for shall provideing complete information including copies of final judgments and pre-sentence reports within thirty days of the final judgment.