Consumer Line

August 2015

OMVIC Message

 

In This Issue


  • Buying an inexpensive car for your academic star? Get educated on how to purchase a car privately!

  • London Curbsider Receives 6 Month Jail Sentence

  • Salesperson Charged in Elaborate Vehicle Export Scheme

  • All-in Price Advertising—It’s the Law! OMVIC’s 2015 Consumer Awareness Campaign

Auto Talk


The OMVIC Compensation Fund


Consumers who suffer a financial loss as a result of a trade (purchase/lease/consignment) with an OMVIC-Registered Dealer may have access to the Motor Vehicle Dealers Compensation Fund. This protection program compensates consumers up to $45,000 per valid claim. It's your right if something goes wrong!

The OMVIC Compemsation Fund Protects Car Shoppers


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CONSUMER PROTECTION

Buying an inexpensive car for your budding academic star? Don’t get schooled…get educated

Sending a ‘child’ off to university or college can be traumatic – for the parents of course; the kid will be just fine. So to make it easier to keep ‘em coming home for more than just Thanksgiving and spring break, some parents will head out with their teens on an elusive hunt for a decent, but cheap, set of wheels. It’s worth noting decent and cheap can be difficult to find peacefully coexisting in the automotive jungle.

“Many consumers looking for an inexpensive vehicle assume their best bet is to buy privately,” explained Terry O’Keefe, OMVIC Director of Communications and Education. “Unfortunately that assumption isn’t always accurate and can lead to serious problems.” That’s because car buyers who purchase privately forego nearly all consumer protections provided by Ontario law. Should something go wrong with a private car purchase, consumers are basically on their own with little recourse other than the court system.

One mistake car buyers often make is assuming that because a vehicle has passed a safety inspection, it has no defects – that is not always the case. “The issuance of a safety certificate indicates items such as brakes, tires, steering components, lights, wipers and the exhaust have met the minimum standards of safety set by the Ministry of Transportation, on the date of inspection,” says O’Keefe. “But it is not a guarantee that nothing is wrong with the vehicle.” Vehicles that pass a safety inspection could still have issues unrelated to safety items (e.g. engine/transmission/air conditioning) that require expensive repairs.

Wading into the private vehicle sales marketplace also exposes consumers to curbsiders. Commonly posing as private sellers (though some work from small auto-related businesses) these illegal, unlicensed car dealers often sell vehicles that are rebuilt wrecks with undisclosed accident repairs or rolled-back odometers. According to O’Keefe, they’re the chameleons of the auto marketplace. “Curbsiders prey on unsuspecting consumers. Often the vehicles they sell aren’t registered in their names (or have only been registered to them for a short time); some even use phony ID.” If a consumer buys from a curbsider and later discovers issues with the vehicle, that seller will be nearly impossible to track down.

And curbsiders are far more prevalent than most consumers understand – as are OMVIC’s enforcement activities. To date in 2015, 30 individuals/businesses have been convicted for curbsiding; 69 additional cases are before Ontario’s courts.

So to avoid getting ripped off and to help ensure your future Rhodes Scholar finds a reliable ride to the campus (and home for visits every weekend of course), get educated. Visit OMVIC’s website and learn to spot the telltale signs of a curbsider and consider the following tips for any private vehicle purchase:

  • Ask questions: how long has the vehicle been owned? Are there maintenance records? Why are they selling?
  • Ensure the seller is the registered owner: ask to see their ID and compare it to the vehicle ownership
  • Take a thorough test drive – not just around the block
  • Research the vehicle’s accident history: buy a history report (CarProof, Carfax) to search for past collision repairs
  • Carefully review the Used Vehicle Information Package (UVIP) – a private seller must provide it (ensure all pages provided)
  • Ensure there are no liens on the vehicle (info usually available on UVIP or CarProof)
  • Have the vehicle inspected by trusted mechanic before purchase

INDUSTRY NEWS

London Curbsider Receives Six Month Jail Sentence

Daljit Bains pled guilty in a London court to curbsiding (acting as a motor vehicle dealer without registration) under the Motor Vehicle Dealers Act and unfair business practices under the Consumer Protection Act. Bains was sentenced to six months in jail.

Nine consumers gave Bains deposits after he showed them vehicles for sale online at auctions in the United States. None of the consumers received a vehicle. In total these consumers lost more than $26,000; the court ordered restitution.

Salesperson Charged in Elaborate Vehicle Export Scheme

A salesperson employed as a business manager at a Markham BMW dealership has been charged by OMVIC for falsifying information and furnishing false information, contrary to the Motor Vehicle Dealers Act.

It is alleged that a dealership employee created false bills of sale using the names, addresses and contact information of dealership customers in order to facilitate the purchase of vehicles for export to China. Although the consumers were not financially indebted by this scheme, their personal information was obtained and used without their knowledge or consent.

“Exporting new cars out of Canada to foreign markets such as China is a lucrative business, as these luxury makes often sell for two or three times their Canadian value,” stated Carey Smith, OMVIC Director of Investigations. “Unfortunately, these export schemes often involve forging documentation and frequently using ‘straw buyers’ or nominees to conceal the sale from the manufacturer and in this case, from the dealership as well.”

According to the dealer, under its agreement with BMW Canada, they must ensure new BMWs sold in Canada are not acquired by individuals or companies for the purpose of exporting; penalties imposed by the manufacturer for breaching this requirement can be significant. The dealership cooperated fully with OMVIC’s investigation. The salesperson’s employment has been terminated by the dealership.

George Chan, 44 of Maple faces two charges under the MVDA. He is scheduled to appear in Newmarket court on September 25, 2015.


HAVE YOU HEARD

All-in Price Advertising – It’s the Law!

A dog relishing a car ride; tongue lapping the air, fur flying in the wind – a sight that exemplifies simple joy; and it’s the imagery supporting OMVIC’s consumer awareness campaign message: all-in price advertising – it’s putting the fun and excitement back into car buying…and, it’s the law!

OMVIC launched the campaign to further educate Ontario car buyers about their right to all-in price advertising. Currently, only 29 percent of Ontarians know that if they see a dealer’s advertised price for a vehicle, that price must include all fees and charges the dealer intends to collect.

All-in Pricing It's The Law

Remember the fun and excitement of buying a car? All-in pricing is bringing it back. Click here to see how!

OMVIC’s province-wide campaign includes online, radio and TV advertising – airing on all major television networks including CBC, CityTV, CTV and Global.


OMVIC Contact

OMVIC administers and enforces the Motor Vehicle Dealers Act (MVDA) on behalf of the Ministry of Government and Consumer Services. OMVIC maintains a fair and informed vehicle sales marketplace by regulating dealers and salespersons, regularly inspecting Ontario's 8,000 dealerships and 25,000 salespeople, maintaining a complaint line for consumers and conducting investigations and prosecutions of industry misconduct and illegal sales (curbsiding). OMVIC is also responsible for administering the Motor Vehicle Dealers Compensation Fund on behalf of its Board of Trustees.