OMVIC Dealer Standard – Fall 2012

.on.ca
Fall 2012
In this issue:
• Determining Priorities
• Fall Consumer Awareness
Campaign
The Results are in!
OMVIC Survey Helps Set Priorities
for 2013 and beyond
• Ignorance is No Excuse
• Salesperson Applicant
Sentenced to 60 Days for
False Statement
Thank you to all those who
participated in OMVIC’s
2012 priorities survey!
• Curbsiders: A Dealer’s
Perspective
The recent survey of dealers,
Season’s
Greetings
The staff of OMVIC wishes
all salespersons and dealers
a happy holiday season and
a prosperous New Year. We look
forward to working with all
stakeholders and remain committed
to providing excellent service while
meeting our mandate to maintain
a fair and informed marketplace for
Ontario’s consumers and dealers.
PRIORITIES
salespersons and consumer
complainants has highlighted
what each group would like
OMVIC to focus on going
88 Dealers and Individuals
to be Charged for
Advertising-Related Issues
forward. The results
might surprise you.
Read more inside
BREAKING
NEWS
A sweep of recent online car ads by OMVIC’s Investigations Team
The Dealer Standard
found a disturbingly large number of dealers advertising illegally.
is published by the
Ontario Motor Vehicle Industry Council
789 Don Mills Road, Ste. 800
Toronto, ON M3C 1T5
T: 416-226-4500
F: 416-226-3208
Toll Free: 1-800-943-6002
Executive Director: Carl Compton
Writer: Terry O’Keefe
Some 88 dealers and individuals will be charged for failing to disclose
a dealership name in their ads, thereby posing as private sellers.
OMVIC investigators also found registered wholesalers offering to sell
vehicles to the public. In total, it is expected that more than 90 charges
will be filed. Further details will be released in the near future.
OMVIC Informs Vehicle Buyers They are
ONLY Protected When Buying From
Ontario-Registered Dealers
Fall Consumer Awareness
Campaign Achieves more than
80 Million Views
Using online, radio, TV, newspaper and
billboard advertising, this year’s campaign
highlighted the protections consumers
The campaign further educated consumers
that curbsiders are lying in wait, ready to
pounce, and they should look for the
“BUY with CONFIDENCE – OntarioRegistered Dealer” decal to help identify
a registered dealer.
receive when buying from a registered dealer
The 2012 campaign targeted many of
and built on previous years’ message:
the sources car buyers use, including:
“Avoid Curbsiders – Buy with Confidence.”
The campaign’s messaging stressed that
consumers are protected only when they buy
nline advertisements on Kijiji.ca,
O
AutoTrader.ca and TorontoSun.com
from you – an Ontario-registered dealer.
earch Engine Marketing using Google
S
AdWords and Kijiji.ca
These protections include:
TV advertisements on CP24’s AutoShop
All-in price advertising
Print ads in the Toronto Sun
ull disclosure of a vehicle’s past-use, history
F
and condition
Static billboards in Windsor and London
Contract rescission rights in certain situations
ccess to the Motor Vehicle Dealers
A
Compensation Fund
igital billboards throughout the province,
D
including Kitchener, Toronto, Kingston
and Ottawa
OMVIC was very pleased to hear from numerous dealers who
said they’d seen the ads in the online marketplaces consumers
were using to find vehicles, thereby reaching consumers when
they were most open to – and in need of – the information.
Determining Priorities
Priorities. We all have them: individuals, businesses, regulators.
And what of OMVIC’s priorities specifically? What do dealers think
they should be? Would the dealer community’s opinions be wildly
different from those held by registered salespeople? And what
about consumers’ expectations?
To try and answer those questions, OMVIC recently sent
a survey to registered dealers, salespeople and consumer
complainants. Each group was asked to rank the
importance of the following:
Reviewing non-compliant activity on the Internet
Providing online services to dealers and consumers
Providing educational outreach to dealers/salespersons
Investigating/prosecuting curbsiders
Following-up on misleading advertising by dealers
Consumer awareness programs
Investigating unethical or illegal practices by dealers/salespersons
OMVIC Customer Service
Working with auctions to improve disclosure and compliance
1,272
responses
What emerged from the
was remarkable agreement in general among the
three groups. Consumers and salespeople ranked
investigation of unethical or illegal practices by
dealers/salespersons as the number one priority;
dealers ranked it second. Dealers ranked
investigation/prosecution of curbsiders number
one, while salespeople ranked it second, and
consumers ranked it third.
Page 2
“These findings reinforce the priorities
OMVIC established for itself with the
help of our board, committees and
stakeholders,” said Mary Jane South,
OMVIC Director of Operations and Deputy
Registrar. “These results will assist as
we continue to examine our priorities
on an ongoing basis.”
Here’s a breakdown of the full results:
2012 Survey
8
7
GREATEST
PRIORITY
6
LEAST IMPORTANT
PRIORITY
5
4
3
Reviewing
non-compliant
activity on the
Internet
(such as ads
by curbsiders
and dealers
posing as
private sellers)
Online
services to
consumers
and dealers
Educational
outreach to
dealers and
salespeople
Investigation
and
prosecution
of curbsiders
Follow-up on
misleading
advertising
by dealers
Consumer
awareness
programs
Investigation
of illegal or
unethical
practices by
dealers and
salespeople
OMVIC
Customer
Service
Work with
wholesale
auctions to
improve
disclosure
and
compliance
Dealers
315
5.9
4.2
4.3
6.7
5.1
4.3
6.2
4.1
4.6
Salespeople
603
5.5
4.0
4.7
6.3
5.4
4.3
6.3
4.0
4.3
Complainants
354
4.7
4.3
3.9
5.0
5.7
5.0
7.0
5.1
4.1
Salesperson Applicant
Sentenced to 60 Days
for False Statement
report from the Durham Regional Police Service, and that the
report outlined a lengthy criminal past including convictions
for fraud and assault. However, when that report was
submitted to OMVIC, it was found to have been altered and
much of the most recent criminal information removed.
The MVDA makes it clear that individuals who make
a false statement on an application to become a dealer or
salesperson are not entitled to registration. In September,
a Durham Region man also learned it’s an offence that can
lead to charges...and jail time.
In finding guilt, Justice of the Peace John Cottrell sentenced
Small to 60 days in jail.
Robert Small, 50, was charged after OMVIC received forged
documentation in support of his sales licence application.
OMVIC’s investigation found Small had provided a falsified
driver’s licence (his was under suspension) and a falsified
criminal background search. At trial, a Durham Region police
officer testified Small had obtained a criminal background
“This sentence sends an important message to dealers and
salespeople, and to consumers” stated OMVIC Director of
Investigations Carey Smith. “Retail automotive sales is
a regulated industry in Ontario, and these regulations exist to
ensure a fair and informed marketplace. OMVIC has a job to
ensure persons seeking registration meet the requirements
set out by law. This case demonstrates that if people want
to cheat to get a licence, there will be repercussions.”
Page 3
.on.ca
Ignorance is No Excuse
Dealers and salespersons who follow the decisions
of the OMVIC Discipline Committee will have noticed
a rather dramatic increase in the number of dealers
finding themselves before the committee for breaching
the Code of Ethics. Most often these cases relate to
non-compliant advertising and/or improper disclosure.
In fact, in 2011, 12 dealers faced the discipline process;
at the time of writing, 47 dealers have been disciplined
thus far in 2012.
When OMVIC issues a Notice of Complaint (an allegation
of a breach of the Code of Ethics and the first step in the
discipline process), it often hears dealers complain they
did not get a warning first. And yet, in almost every case,
the offending dealer did get a warning – a warning in the
form of a Dealer Bulletin. OMVIC issues numerous
bulletins to remind, and yes, warn, dealers of their
responsibilities under the Motor Vehicle Dealers Act
(MVDA). It is very troubling when dealers claim they did
not know or understand the regulations they had
breached. This is why OMVIC recently issued a bulletin
simply outlining the importance of reading the bulletins
and staying informed.
Still, we recognize the irony of sending a “Hey! Read this
darn bulletin” bulletin to dealers who don’t read them
in the first place, which is why we’re reprinting it here:
sometimes seems to fall on deaf ears. “OMVIC sends out
regular bulletins,” says Smith. “Often these are meant
to remind dealers about their responsibilities under the
MVDA and to help ensure they don’t get into trouble.”
According to Terry O’Keefe, OMVIC Manager of
Communications and Education, OMVIC would much
rather educate than lay charges: “Our bulletins really are
meant to inform and prevent problems. But they can’t be
effective if people don’t read them.”
Often OMVIC hears from a dealer or salesperson facing
a discipline notice: “But I fixed the problem when the
inspector pointed it out”; unfortunately though, fixing
the problem after you’re caught may be too late. And
according to O’Keefe: “Telling a judge or discipline panel
‘I didn’t know that was illegal’ is unlikely to garner
sympathy, especially if there has already been a bulletin
distributed about the issue….so please, read them.”
WHERE TO FIND BULLETINS AND
OTHER MVDA GUIDES:
OMVIC Bulletins
http://bit.ly/OMVICBulletin
MVDA information videos
http://bit.ly/mvdainfo
The Dealer Standard newsletters
http://bit.ly/dealerstandard
READ THE BULLETINS
Fixing the problem once
you’re caught is too late.
‘Ignorance of the law is no defence’ – how many times
have we all heard that reprimand when someone
accused of wrongdoing claims: “I didn’t know I couldn’t
do that.” And yet, OMVIC investigators and inspectors
hear it on a regular basis.
“It’s frustrating,” says Carey Smith, OMVIC Director of
Investigations. “This is a regulated industry and dealers
and salespeople are expected to know the regulations,
and abide by them.” What makes it doubly frustrating is
that OMVIC’s efforts to ensure dealers are informed and
educated, especially about problematic trends,
OMVIC Automotive Certification Course
offered at a reduced cost to currently
registered dealers and salespeople −
covers: MVDA, contract and disclosure
requirements, advertising regulations,
Code of Ethics, Consumer Protection Act,
Sale of Goods Act. The course is offered by
Georgian College and is available through
correspondence or in-class lecture
(one day).
Visit the Automotive Certification
Course’s website for more information:
http://bit.ly/GeorgianCollege
Page 4
CURBSIDERS: A Dealer’s Perspective
An open letter to Ontario’s registered dealers
As a dealer, I really really dislike curbsiders.
They are in the same business as us, but do it
illegally. They have no overhead, avoid taxes,
ignore the law, don’t stand behind their products,
misrepresent themselves and often the vehicles
they sell, and on top of that, they’re trying to sell
to my customers – costing me money.
As the Chair of OMVIC’s Board of Directors I see how
much blood, sweat and tears OMVIC staff put into
eliminating the dangers caused by curbsiders; and I mean
dangers. Often curbsiders sell previously written-off
vehicles without disclosing this fact. Many of these
vehicles are poorly repaired, but with the help of an
unscrupulous mechanic, these vehicles get certified and
put on the road where they pose a threat to the consumers
who bought them, and to your families and mine who
share the road with those buyers. Of course the curbsider
is long gone – looking for his next vehicle to buy – probably
looking at your dealership, and mine. And as a dealer and
as OMVIC Chair, it angers and disappoints me to know
how many of my fellow registered dealers will turn a blind
eye and provide these illegal dealers, because that is what
they are, with inventory.
Compensation Fund Seeks
Dealer Board Members
The Motor Vehicle Dealers Compensation Fund Board of
Trustees is seeking two dealer members to serve on the
board beginning June 1, 2013.
The Compensation Fund was established to compensate
consumers who suffer a financial loss as a result of a
OMVIC spends a small fortune (and some of it is your
money) investigating and prosecuting curbsiding, and even
more on consumer awareness campaigns. This is meant
to protect consumers and our industry – us. When dealers
provide curbsiders with inventory it thwarts the efforts
OMVIC is making to provide a fair and informed
marketplace – for us. And it’s illegal to boot.
As dealers we have an important role to play in the
elimination of curbsiders. With a concerted effort, we can
turn off the supply taps to 50% of the vehicles curbsiders
sell. Will it mean we have some trade-ins that might sit
around a little longer? Probably; but that is a small cost to
pay to help eliminate this danger and to ultimately bring
more consumers into our showrooms.
Kevin Bavelaar
P.S. OMVIC’s recent bulletin on this issue has some
good tips designed to ensure your dealership isn’t selling
to curbsiders. http://bit.ly/CurbsiderBulletin
transaction with a registered dealer. The Board of
Trustees reviews the eligibility of each claim to the Fund.
Interested dealers should send a resume and letter
of interest to Fund Administrator Jeff Ross at
[email protected] before February 20, 2013.
The successful dealer applicants will be screened and
must submit a Canada-wide criminal background check.
Publication Mail
Agreement #40021863
The Dealer Standard
Return undeliverable
Canadian addresses to:
789 Don Mills Road, Ste. 800
Toronto, ON M3C 1T5