Consumer Line

October 2015

OMVIC Message

 

In This Issue

  • Don’t Let Your Car Buying Experience Become A Horror Story—Avoid Curbsiders

  • Misrepresentation and Illegal Vehicle Sales Earn $54K Fine

  • Free Educational Seminars Available for Car Buyers!

Auto Talk


Know Your Rights


Consumer Protection Legislation:

There are a number of consumer protection laws in place for Ontario car-buyers: the Motor Vehicle Dealers Act (MVDA) and the Consumer Protection Act (CPA) are the primary two. However, the protections afforded by this legislation only apply if a consumer purchases from a registered dealer. Should something go wrong with a private purchase, or a purchase from a curbsider, that car-buyer is essentially on his or her own; OMVIC cannot assist and private purchasers cannot make a claim to the Motor Vehicle Dealers Compensation Fund. There is little recourse for private purchasers other than to the courts.

Consumers who do purchase from an OMVIC-Registered Dealer are entitled to a number of key protections including:

  • All-in price advertising – dealers cannot add additional fees in excess of an advertised price with the exception of HST, licensing or for options the purchaser requested
  • Full disclosure of a vehicles past-use, history and condition
  • Cancellation rights – if a dealer fails to make certain mandated disclosures the consumer can cancel the contract within 90 days of delivery
  • Access to the Motor Vehicle Dealers Compensation Fund – This fund compensates consumers who suffer a financial loss as a result of a trade with a registered dealer. The claims criteria is set out in the MVDA

Click here to learn more about consumer protection legislations and how they apply to vehicle sales and purchases in Ontario—and remember;

You Are Protected OMVIC Decall


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CONSUMER PROTECTION

Horror Story

Jack-o-lantern flames gutter in a chill wind. Discordant music echoes from once serene suburban houses. Lights strobe disorientatingly. Macabre figures adorn once neatly pruned trees. Grave markers appear with eerie and disturbingly piled leaves on lawns that were just yesterday pristine. Eyes narrow….senses heighten. Ah yes…Halloween. A time for fear….and fun. The little kids get 2 hours of costumed candy collection; and the bigger kids (i.e. most of us) break out our favourite horror films. So many of us love to get scared. There’s a visceral reaction to it – it awakens our primal “fight or flight” response.

It used to be car-buying required the same heightened senses – the same “prepare for anything” attitude that survivors of a zombie apocalypse would need – but fortunately, thanks to Ontario’s consumer protection laws, times have changed and consumers needn’t shop in fear.


Consumer Protection—The Motor Vehicle Dealers Act

In 2010, the commercial marketplace (i.e. registered dealers) saw stricter regulations introduced. As a result registered dealers are now required to advertise all-in prices and provide full disclosure related to the past-use, history and condition of the vehicles they sell. But, there remains one area of the automotive marketplace that can be nearly as scary as Elm Street – the private online classifieds.

Can in the Webnet


Buying a Used Car Privately

“Buying privately certain comes with more risk than buying from a dealer,” explains Terry O’Keefe, Director of Communications and Education for OMVIC – Ontario’s vehicle sales regulator. “Perhaps the biggest danger is posed by curbsiders.” Curbsiders are illegal, unlicensed dealers. Commonly they pose as private sellers or operate from small automotive-related businesses like repair shops. “Often the vehicles they sell are rebuilt wrecks or have rolled back odometers.” Consumers who fall victim to these unscrupulous sellers have little recourse when they discover the truth about the vehicle they’ve bought. “Finding curbsiders after the sale is nearly impossible for most consumers,” explains O’Keefe. “Very often the vehicles sold are not registered in the seller’s name so the buyer doesn’t even know who they actually bought from.”

OMVIC investigates and prosecutes curbsiders on a regular basis; the penalties handed down by the courts for those convicted can be severe. “Recently we’ve seen fines of $11-54,000 and a six-month jail term in four high profile curbsider cases.” But while these successful enforcement actions send a strong message to those who would prey on unwary car-buyers, it doesn’t actually address the financial losses their victims suffer when they discover the true history of the vehicles they’ve purchased.

Curbsider


To help consumers avoid a curbsider, OMVIC offers these tips:


  • Beware of Vehicles Priced Below Market Value

In order to sell vehicles as quickly and easily as possible, curbsiders may offer a “too good to be true” price. They can do this because the vehicles are often accident-damaged, odometer-tampered or rebuilt write-offs. If a deal seems too good to be true, it’s a warning, not an opportunity.


  • Know Who You’re Buying From

Curbsiders often sell vehicles that are not registered in their names (or have only been registered in their name for a short period). It’s important to ensure you’re dealing with the registered owner. Be bold and ask for ID and proof of ownership: they should match.


  • Research the Vehicle’s History

Reports from CarProof and Carfax may provide useful information on reported collisions/incidents, liens, past odometer readings, previous out-of-province registration and Ministry of Transportation branding (e.g., salvage, irreparable, rebuilt, none)


  • Get a Second Opinion

Have the vehicle inspected by a licensed mechanic. He or she may find problems the seller did not disclose or know about.

Buying a used car privately needn’t require a young priest and an old priest, a wooden stake or a silver bullet; it does however require equal doses of vigilance and awareness. Education is key – but hey, you still might want to avoid cars for sale on Elm Street….just sayin’.


INDUSTRY NEWS

Misrepresentations and Illegal Vehicle Sales Earn $54K Fine

A Toronto-area group has been convicted of curbsiding (acting as a dealer without registration), contrary to the Motor Vehicle Dealers Act (MVDA) and committing unfair practices in breach of the Consumer Protection Act (CPA).

OMVIC charged 2141212 Ontario Corporation (operating as Monterey Auto Repair), Amilcar Luis Monte Rey Nunez, Anibal Salomon Monte Rey Rios, Sergio Ruben Monte Rey Nunez, Bianca Daniela Lopez and Alejandra Penarrieta after an investigation found vehicles being sold illegally from Monterey Auto Repair in Toronto, and at least one other from a nearby apartment complex. “In Ontario, all dealers and salespeople must be registered with OMVIC. The repair facility was not registered, nor were any of the individuals,” explained Carey Smith, OMVIC Director of Investigations. “In fact, two of the accused, Amilcar Luis Monte Rey Nunez and Anibal Salomon Monte Rey Rios, had previous curbsiding convictions.”

Each of the individuals was also convicted of engaging in an unfair business practice, contrary to the CPA. “They were selling cars that had been written off, branded as salvage and then rebuilt, without disclosing this to the purchasers,” stated Smith. In one instance, a consumer was told the vehicle was a “good clean car.” In reality, it was a previous write-off that had sustained more than $13,000 collision damage. Another consumer, after specifically asking if the car had ever been involved in an accident, was told the car had been repaired due to “a small scratch at the bottom of the door.” That car had actually been branded as salvage after sustaining more than $10,500 in damage.

The total fine amount for the convicted parties was set at $54,500 plus 25% victim fine surcharge – to be paid within twelve months.


HAVE YOU HEARD

FREE Educational Seminars Available for Car Buyers!

As part of our mandate to protect and educate Ontario consumers, OMVIC provides Car-Buying Seminars throughout the province. These free information sessions are offered to community groups, newcomer centres and schools!

OMVIC Free Seminar

Topics covered include:

  • Laws that protect consumers and when they apply
  • What dealers must disclose about the history and condition of the vehicles they sell
  • What you can expect from a dealer’s advertisement
  • Differences between buying from a dealer and buying privately
  • Curbsiders: the dangers they pose and how to avoid them
  • OMVIC’s role as industry regulator
  • The protection offered by the Motor Vehicle Dealers Compensation Fund

If you’re interested in having OMVIC present this seminar to your organization or community group, or for more information, contact us at omvic@omvic.on.ca or by telephone at 1-800-943-6002x3185.

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.