The Combating Auto Retail Scams Act, SB 766, enacted in California on October 1, 2026, requires dealers to prepare, preserve and archive all records necessary to demonstrate compliance for two years from the date the record is made. This includes advertisements, price communications, contracts, additional documentation, cancellations, refunds, and written complaints.
The CARS Act is based on the FTC’s federal CARS Rule proposal. California introduced SB 766 and Governor Newsom signed it on October 6, 2025. The law is set out in California Civil Code §1784.1 et seq.
The Act has no single regulator. City attorneys, county district attorneys, the California Attorney General, and the Department of Motor Vehicles, which licenses dealers, can all act on complaints. Consumers can’t sue under the Act directly, but can bring claims under California’s Unfair Competition Law and Consumers Legal Remedies Act. In each case, the first request is usually for the dealer’s records.
The CARS Act covers motor vehicle dealers licensed in California and anyone else who fits the definition of “dealer” in the California Vehicle Code. Those outside California who advertise to buyers in California should seek legal advice to determine if they fall under that definition.
The retention duty applies to any record needed to show compliance with the Act; in practice, this includes:
The CARS Act’s two-year period starts when a record is made, not when a car is sold. A vehicle detail page (VDP) captured on October 1, 2026, must remain retrievable until September 30, 2028, even if the vehicle never sells.
The two-year requirement introduced by SB 766 does not override existing ones. For example, Civil Code §2984.5 requires dealers to retain documents for financed sales for seven years or longer. Dealers must now assign each record the longest applicable retention period.
The table below maps each record type to its SB 766 retention period and notes where a longer California rule applies.
| Record type | What it includes | SB 766 retention | Longer rules that may apply |
| Advertisements and listings | Online ads, VDPs, and listings that reference a specific vehicle, including the total price shown | 2 years from creation | SB 766 only |
| First written price communications | External emails, texts,[1] [2] and written replies to a consumer’s price inquiry about a specific vehicle | 2 years from creation | SB 766 only |
| Purchase, finance, and lease documents | Signed contracts and related disclosures | 2 years from creation | Financed sale contracts: 7 years or more under Civil Code §2984.5 |
| Add-on documentation | Records showing the add-on benefits the buyer, and the disclosures given | 2 years from creation | SB 766 only |
| Cancellation records | Cancellation requests, refund evidence, and returned trade-in records | 2 years from creation | SB 766 only |
| Complaints and inquiries | Written complaints and inquiries about add-ons and vehicles, and the dealer’s responses | 2 years from creation | SB 766 only |
The date a contract is signed is fixed, but the date for a dealer’s website is not. VDP prices, incentives, payment calculators, and disclosures can change many times a day across hundreds of listings.
If a consumer challenges an advertised price, the dealer must prove what the listing showed on that date. A screenshot captures the page image but omits the page source, interactive elements clicked by the buyer, and evidence linking the image to a specific time.
A defensible advertising record captures a complete copy of the page as it appeared, attaches a timestamp, and includes a hash value proving the file has not been altered. The record replays the page with all original dropdowns, calculators, and disclosures intact, so a reviewer sees what the buyer saw.
Under the California CARS Act, buyers or lessees of used cars priced at $50,000 or less have the right to cancel the transaction within three days. Dealers may charge a restocking fee limited to 1.5% of the sale price, with a minimum of $200 and a maximum of $600.
The CARS Act requires dealers to retain records of each cancellation, including the request, refund evidence, and records of any trade-in returned to the buyer. Although the law does not specify how to document the vehicle’s condition at delivery, that record often determines if the returned vehicle was in the same condition.
Auto finance contracts in California are governed by the Rees-Levering Automobile Sales Finance Act and the FTC Holder Rule. The Holder Rule states that any claims a buyer has against the dealer also apply to the lender holding the contract. If a dealer cannot produce the advertisement or price communication for a contested sale, that gap becomes the lender’s liability. Some California credit unions now require dealer partners to certify they retain SB 766 records for two years.
A violation of the CARS Act can be pursued as unfair competition under California’s Unfair Competition Law. In an action brought by the Attorney General, a district attorney, or a city attorney, a court must impose a civil penalty of up to $2,500 for each violation. When the affected buyers are seniors, disabled persons, service members, or veterans, an additional penalty of up to $2,500 per violation can apply.
Penalties are counted per violation, and courts weigh how many violations occurred and how long they went on. A missing total price on one VDP template can repeat across every listing that uses it, for as long as the template stays live. Penalties also come on top of restitution to affected buyers.
Records decide how these cases go. A dealer that can show what each listing displayed, and when, can limit an inquiry to the listings at issue. A dealer without those records has no way to show the error was isolated or corrected.
Hanzo Chronicle captures dealer websites on a set schedule, so each price, incentive, calculators and disclosure change is preserved as it appeared on the site.
Each capture is saved in WARC format, the standard file format for web archives, and includes the full page source, not just an image. Chronicle timestamps every capture, records a SHA-256 hash value, and stores it on WORM storage, so the file can’t be changed after it’s saved. If a price is disputed, the hash shows the record matches what was captured on that date.
Captured pages replay with their original dropdown menus, forms, and payment calculators. A reviewer can open a VDP from 18 months ago and click through it the way a buyer did, including the expandable disclosures a screenshot would miss.
Chronicle also uses AI to review captured pages against the rules a dealer sets, such as a total price appearing on every VDP or a required disclosure being present. When a page is missing a required element, Chronicle sends an alert, so the team can fix a template before the error repeats across hundreds of listings. As inventory grows and pages change daily, monitoring keeps pace without adding manual spot-checks.
For more information about Chronicle, contact our team.
When does the California CARS Act take effect?
October 1, 2026.
Is the FTC’s CARS Rule currently in effect?
No. The Fifth Circuit vacated the rule in January 2025, and the FTC withdrew it effective February 12, 2026. The California CARS Act is a separate state law.
How long does the CARS Act require dealers to keep records?
Two years from the date each record is created, regardless of whether the vehicle sells.
Does the CARS Act replace existing record retention rules?
No. It adds a two-year requirement on top of existing obligations, such as the seven-year retention period for financed sale contracts under Civil Code §2984.5.
Which vehicles does the three-day right to cancel cover?
Used vehicles with a retail price of $50,000 or less.
Why is two-year record retention hard for dealer websites?
VDP prices, incentives, and disclosures change daily, and vehicles come and go from inventory. A listing that’s gone from the site may still need to be produced two years later. Dealers need a record of each version of a page, captured when it was live.
How can dealers archive their vehicle websites for the CARS Act?
A web archiving tool captures the site on a schedule and saves each page with its source, a timestamp, and a hash value. Hanzo Chronicle stores captures in WARC format on WORM storage and replays pages with their original calculators, dropdowns, and disclosures.
What happens if a regulator or plaintiff asks for CARS Act records?
An inquiry usually starts with a request for specific records: the ad a buyer saw on a given date, the dealer’s written price quote, and the documents behind an add-on or cancellation. Dealers that can retrieve records by date and vehicle can answer quickly and limit the inquiry to the listings at issue. Involve counsel as soon as a request arrives.
How can dealers check that their website stays compliant?
Hanzo Chronicle uses AI to review captured pages against the rules a dealer sets, such as a total price on every VDP or a required disclosure being present. When a page is missing a required element, Chronicle sends an alert so the team can fix it before the error spreads.
Hanzo
N/a
© Hanzo 2026 | All Rights Reserved.