Dealership group adds 1st compliance boss

,Red Rock Auto Group in Grand Junction, Colo., has hired a former Colorado Board of Revenue investigator to head compliance for its five stores after state investigations into its finance-and-insurance and advertising practices.

During Dale Sundeen's 15-year tenure at the state agency, he looked into consumer complaints against Colorado dealerships, including Red Rock. Now, the 58-year-old is on the other side of the equation — making sure Red Rock's employees maintain compliance with all federal and state regulations.

"I want to bring my experience and expertise as far as state law and kind of be a reference and make sure our salespeople are compliant. Anything that would help us avoid any kind of issues with state laws, rules and regulations, as well as federal," Sundeen told Automotive News.

Sundeen will work with employees in all areas, including finance and insurance, sales, service and parts and IT. He started his role as Red Rock's first corporate director of compliance Feb. 21.

"He's training sales and finance guys on how to protect themselves and protect our customers on every transaction," Bryan Knight, a Red Rock minority owner, told Automotive News. "He'll be reviewing our videos of all F&I transactions."

Compliance in consumer transactions and handling of personal information are major concerns for dealers and lenders especially as on misleading or illegal F&I practices such as forgery, junk fees and other discriminatory practices.

Red Rock Hyundai was on a local television news report in January after a customer complained he bought a truck from the dealership and without his approval was charged $10,000 for an extended service contract.

Responding to the report, Knight said Red Rock in February 2022 hired a new finance director who "had signed some things he shouldn't have."

"We fired him that day," said Knight, who is a platform manager for all five stores with each general manager reporting to him.

Knight said Red Rock bought the car back from that consumer and helped him "find a newer, nicer car for cheaper. We thought we had made everything whole with him."

Red Rock did not receive a state citation regarding the situation, Knight said.

"We've had absolutely nothing — zero citations, warnings," Knight said. "Throughout the whole process, we've had zero from the state of Colorado saying we've done anything wrong. We've had multiple investigations into different scenarios."

Knight said Red Rock always has given customers the choice between digital and print copies of contracts.

"Now if someone chooses the digital version, we print out the purchase agreement that itemizes dollar amounts to avoid any appearance of hiding information," Knight said. "We probably started doing that in December [or] November."

Consumers' complaints filed against Red Rock include accusations of forgery and misleading advertising.

"There were some complaints that the digital signatures didn't look equivalent to a written signature. So people alleged forgery when that happened, but nothing's come of that," Knight said. "There were a couple complaints of selling a car for more than an advertised price, but those never resulted in anything substantive."

Suzi Karrer, a spokesperson for the Colorado Board of Revenue's auto industry division in Denver, told Automotive News that consumer complaints against dealerships in the state are "pretty common."

"There's a big misconception out there that there's a big investigation into Red Rock Auto Group," Karrer said. "There is no big investigation."

The state's auto industry division investigates all consumer complaints and presents any issues requiring action to the Colorado Motor Vehicle Dealer Board, she said. Since 2020, no complaints against Red Rock have gone to the Colorado Motor Vehicle Dealer Board, Karrer said.

"There have only been two recent ones that were found with no violations," Karrer said of complaints filed against Red Rock in the last six months. Karrer said the auto industry division investigated Red Rock Hyundai for "an advertising issue" in the last six months.

"We issued a warning letter, but after the fact we found the dealership actually made the consumer whole before the consumer complained to us," Karrer said. "We didn't have that information during the investigation."

That investigation was closed with just a warning letter, she said.

"We have a couple open forgery investigations, but just like with any other auto dealership or group, there's not one specific issue [about Red Rock] coming in to us," Karrer said.

Sundeen said investigations he was involved in regarding Red Rock "were mostly just informational — 'these are Colorado state rules, be careful of this' — things like titles. I kind of considered them not anything criminal investigative-related, but actually more educational."

He said he was involved in investigations until about November or December 2022, when he started considering retiring from the state and joining Red Rock.

"Nothing I have investigated with Red Rock was out of the norm from any dealership that I ever investigated in the last 15 years," Sundeen said.

Sundeen said when he worked for the state, he looked into a Red Rock complaint in which a customer said the dealership was "trying to charge different amounts than the advertised amount with a cash sale versus a finance sale." He said he found "this was actually kind of the opposite. It was a promotion thing the dealer was giving a break for people that would finance. They weren't changing the advertised price like it was alleged."

Sundeen said he plans to use his expertise as an investigator to ensure compliance throughout the Red Rock organization.

He will ensure Red Rock is "disclosing and selling properly" and will be reviewing all aspects of the business, Knight said. That will include making sure service and parts customers' private information is kept secure, he added.

One of Sundeen's first priorities is to help Red Rock meet the to increase security measures for customer information.

Red Rock Auto Group has about 300 employees who work at its five dealerships, all in Grand Junction. The group is owned by Knight, Steven Dahle, Marcus Dahle, Vic Ream and Tyler Slade. The quintet bought a Nissan store in 2016 then added four stores that sell GMC, Honda, Hyundai and Kia.

"We're just trying desperately to take care of customers and do it the right way," Knight said. "I don't know if there's a dealership out there that hasn't made a mistake dealing with a customer. We've hired the most qualified person we know to protect us."