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OMVIC Blog: Car Buying Tips

Trade-In Gone Wrong: Comp Fund Makes it Right!

Nov 13

Monday, November 13, 2017  RssIcon

At least five days a week, Kelly Hult, college student and single mom of two toddlers (with a third on the way), commutes half an hour to school in Sault Ste. Marie. “My car didn’t handle the snow-covered highways very well,” explained Kelly with understated charm. “That’s why I decided to trade my 2011 Chevrolet Cruze for a slightly older pickup truck.” She settled on a 2008 Chevy Silverado.

 Aerial View of Parking Lot

Personal Story: Kelly Hult, Sault Ste. Marie

Kelly made that fateful transaction in April from Personal Touch Auto Limited in the Sault. The dealer arranged financing for Kelly that included purchasing the Silverado and paying out the loan on her trade-in. She was also promised a free 12-month warranty. “When I came to pick up the truck he said he’d put the documents in the vehicle….but they weren’t there;” ominously, Kelly discovered the paperwork wasn’t the only thing missing, the dealer failed to pay off the loan on Kelly’s trade-in. “The bank was taking $684 a month out of my account for the Silverado, plus $273 each month for the Cruze.” 

Personal Touch told Kelly it was a bookkeeping error and that it would be dealt with immediately, but the double payments kept coming out of her account. “Include pregnancy and going to school on top of it all. It was really difficult.”

What Kelly didn’t know at the time was that Personal Touch Auto Limited and owner Gino Burzese were under investigation by OMVIC, Ontario’s vehicle sale regulator. “I heard about it on the news when OMVIC ordered the dealer closed.” Shortly after, Kelly received a call from an OMVIC representative.

How OMVIC Helped

Following an inspection of Personal Touch Auto OMVIC suspended and then revoked the dealership’s (and Burzese’s) licence alleging they:

  • did not deliver vehicles for which payment had been received
  • did not pay, or only made partial payments, to consumers who vehicles were sold by the dealer on a consignment basis
  • did not remove liens from vehicles traded in, leaving consumers potentially responsible for the debts
  • did not submit contracts and/or payments for extended warranties customers had purchased

When Kelly got a call from OMVIC she learned that because the dealership was a registered dealer at the time she bought the truck, she was entitled to make a claim to OMVIC’s Compensation Fund.  “The Compensation Fund reimburses eligible consumers who have suffered a proven loss related to a vehicle purchase or lease,” explained Laura Halbert, OMVIC’s Deputy Registrar and Manager of the Compensation Fund. “It’s very unfortunate that this situation arose, but ultimately, because Kelly dealt with a registered dealer, she was protected.”  For Kelly, that meant receiving $12,288.05 from the Fund; $10,029.18 to pay off the loan on the car she traded-in and $2,258.87 for the cost of the “free”  warranty that OMVIC discovered she’d actually been billed for, after a copy of her  documentation was obtained from a financial institution. “I was able to pay my car off. Knowing that I don’t need to keep paying it and have the extra $200 and some a month to put toward other bills - is great. I don’t have to stress about it.”

OMVIC’s Compensation Fund

Kelly is not the only Personal Touch customer to file a claim with OMVIC. “Since revoking the dealer’s registration we have processed and approved 16 claims totalling more than $262,000.” Another Personal Touch customer who received more than $20,000 from the Compensation Fund said, “It feels like a huge weight off my shoulders knowing this has been cleared and taken care of through OMVIC.” According to Halbert there are nine additional claims pending, and even more anticipated.


Moving On

As for Kelly, she’s putting the ordeal behind her and is focused on the imminent arrival of her third child. But she did offer one bit of advice to any car buyer: “Get your contract and paper work right away, so you know what you’re paying for, and read reviews on the company.” That’s sound advice. And one place to search for information is the regulator’s website, There, car buyers can learn if a dealer or salesperson is registered, or has been charged, convicted or disciplined (the latter for breaches of the Code of Ethics). “It is a valuable resource,” said Halbert, “because ultimately, a better educated and informed consumer is a better protected consumer.” 

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