Read Dealer Standard Winter 2004 text version

Winter 2004

President's Column

Inside this issue

Refused/Revoked Dealers 2 Refused/Revoked Salespersons LAT Cases Industry Headlines Concerned About Third Party Warranties African Email Update Unsung Heroes OMVIC Survey 3 4 7 8 9 10 11

I

n the wake of SARS, monkey pox, a major power failure, government elections, our preoccupation with unrealistic "reality" shows and the excitement of Saddam's capture, it's easy to forget what else the world was up to in 2003. The little things ­ the events that don't make headline news every evening or hit with tragedy ­ are often lost from memory.

numbers are both pleasing and encouraging, but they don't reflect some of the comments included on the survey returns. One of the areas for improvement seemed to rest primarily with OMVIC's level of customer service. As always, your comments were taken seriously. All OMVIC staff completed a two-day intensive customer service training session earlier in the year where reasonable levels of customer service for phone, counter, application processing, complaint handling and field services were developed. Written comments on the survey cards also suggested many of you are aggravated with not knowing how your curbsider complaints are handled. While Section 14 of the MVDA does not permit staff to share any information which comes to their attention as a result of a complaint, inspection, investigation or inquiry, rest assured that OMVIC does act on every tip it receives. Curbsider activity can be reported to OMVIC or called in anonymously to 1-888-NOCURBS (662-8727). Updates on curbsider convictions will be published in next issue of The Dealer Standard. The message here is that dealer feedback is vital and your concerns are heard. With that in mind, be sure to review the suggested amendments to third party warranties on page 8. OMVIC's Industry Professionalism Committee has spent time working on the proposed amendments and your opinions and comments are needed. Finally, I hope you and your family enjoyed the holiday season ­ I look forward to our work together in 2004.

www.omvic.on.ca

This issue is, in many ways, a record of OMVIC's efforts through 2003 ­ some of the little things that made a difference in the dealer community. You often question what OMVIC is doing to keep our industry clean and the list of revoked and refused dealers and salespersons on pages 2 and 3 is a perfect example of its work. This annual listing has quickly become the most popular issue of The Dealer Standard, and with close to 200 individuals and businesses listed for 2002-2003, the index includes applicants and previous registrants who have failed to meet our standards of honesty, integrity and financial responsibility. Also of interest will be the selection of Licence Appeal Tribunal decisions. They paint a picture of the types of applicants denied registration and the reasons behind those decisions. While these feature stories may focus criticism on the individuals who haven't been welcomed in the industry, keep in mind OMVIC is more than willing to focus criticism on itself as well in this 2003 review. Yes, the list of refused and revoked individuals is impressive, but it doesn't provide an accurate report card for the year. OMVIC has judged itself through some of its own benchmarks, but for the most part, has turned to you, its members, for critique and comment. Close to 3,000 survey cards have been returned to us and they outline both the good and the bad. The good news is that 95% of the cards awarded OMVIC staff with a score of 4 or more points out of a total of five in the areas of courtesy, knowledge and efficiency. These

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The Dealer Standard Winter 2004

Below you will find the third annual listing of refused and revoked dealers and salespersons. The list includes individuals whose registration was refused or revoked between January 1, 2002 and September 30, 2003. Although we have listed municipalities to avoid confusion, in some cases there may be existing dealers or salespersons with names similar to those listed who have not been the subject of any administrative action by OMVIC. We apologize should this cause any embarrassment to those individuals and remind readers the real-time registration status of any applicant is available on-line at www.omvic.on.ca or by calling OMVIC's office. For other questions regarding this list, please contact OMVIC at 416-226-4500 or omvic@omvic.on.ca.

REFUSED/REVOKED DEALERS 2002-2003

(ending Sept. 30, 2003)

Legal Name

1085091 Ontario Limited 1190467 Ontario Ltd. 1296945 Ontario Inc. 1302406 Ontario Limited 1306609 Ontario Inc. 1328615 Ontario Ltd. 1346333 Ontario Inc. 1362387 Ontario Inc. 1371044 Ontario Inc. 1381357 Ontario Ltd. 1402078 Ontario Inc. 1544803 Ontario Inc. 469424 Ontario Limited 611 Auto Centre Inc. 617850 Ontario Inc. 732536 Ontario Ltd. 919810 Ontario Inc. Alandy Auto Sales Ltd. Auto Mart Sudbury Ltd. Burlington Auto & Lease Centre Inc. Carl Reinhart Cheryl Grace Ladd Civic Autos Inc. Constantin Tofan Dan Gallotti David John Chase Delta Minivan & Cars Inc. Discovery Car Sales Inc. Display Auto Centre Inc.

Donald J. Wong Won & Franklyn Wong Won

Trade Name

Embassy-Auto-Sales-Service A1 Car Sales

Municipality

Vanier North York North York

Legal Name

Exclusively Yours Leasing Inc. G.T.A. Auctions & Liquiditions Inc George Iyamu Hamzi M. Tahan Hoang Van Nguyen J&T Collision Inc. James Fredrick Whitten Jeffrey Carter JKA Motor Ltd. Kenneth G. Edmonds Leblanc Motor Sales Ltd. Leo A. Duchesne Leo A. Medd Leung Wong Fine Cars Co. Ltd. Masoud Hanasavha Maxwell O. Nsafoah Mimi Giorgio Mohebali Mojarrab Nash Anderson

Trade Name

Municipality

Concord Downsview

Carera Auto Sales Mizo Car Sales Speedwheel Auto

Etobicoke Scarborough Kitchener Kitchener

Colson Motor Cars Auto Wholesale T.D.R. Auto Sales Kadara Motors B T M Wholesale Queensway Kia Liana Car Sales Triple Crown Leasing & Sales World Wide Express Auto Sale Queenston Park Auto Sales

Scarborough Guelph

Tyendinaga Mohawk Territory

Etobicoke Thorndale Etobicoke Toronto Concord Windsor Hamilton London

Niagara Investment Motor Cars

AAA Carter's On The Spot Auto Glass

Niagara-On-The-Lake Hamilton Mississauga

Shelby Motor Car Company

Hamilton Rockland

Duchesne Tire & Auto Leo's Auto Sales

Sturgeon Falls Seaforth North York

Cozy Corners Perfect Cars All Service Auto Centre

Windsor Richmond Hill Schomberg Oshawa Garson Burlington

Ace Auto K&K Fine Cars Tauntonview Car Sales Uptown Used Cars Globe Auto Sales

Toronto North York Concord North York Stouffville Cambridge Gormley Monetville Scarborough Etobicoke Hampton North York London St. Clements North York Napanee

Patrick Domonchuck, Helio Silviera & Leon Lovsin PHL Motors

Carly-O Auto Sales Chers A1 Auto Sales

Cambridge Kitchener Scarborough

Paul Stevenson Phillip Lupton Rajwant Kaur Multani Roble Nour Sam Corporation Sarvi Mohsen Sebsibe Amiye Ashame Shiqer Bajrami Taghi Vahid Shahidi

Welcome To Ron Kennedy Sales and Leasing

Back Yard Auto Sales Whispering Pine Auto & Marine Nanco Motors Harar Auto Sales BMB Enterprises MS Auto Wholesale KDA Used Cars S.B. Auto Centre GTA Auto

C & D Motors Roadstar Lagistic Express Baytown Auto Sales

Hamilton Guelph Callander Cambridge North York North York

Turbo Auto Sales

Scarborough Concord

Exclusive Auto Marketing Inc.

Younis Sabah Younis

Eagle Car Sales

Etobicoke

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The Dealer Standard Winter2004

REFUSED/REVOKED SALESPERSONS 2002-2003

(ending Sept. 30, 2003)

First

Andy W. Justin A. John J. Samson D. Evan L. Andrew H. Brian A. Edward J. Attila Mario Sam Benyamin J. Eugene J. Gershon Anthony B. John A. Pierre J Christopher D. Wilson Steve Ronald Leonard W. R.C. Gerry Rashid A. Soumen Peter Marc John Dean Ronald Douglas Bradin Wayne Zubair A. Matthew Joseph Gregory Brant A. John P. Frank M. Jean Francois Jeffrey Allan Michael E. Ali M. Mark S.

Last

Abbott Amo Armstrong Awodamola Back Bailey Barker Beaulieu Beleznay Belfrutto Benguaich Benyamine Borg Boulaievsky Bruccoleri Buntsma Caissie Clermont Cobena Coliviras D'alessio D'arrigo Daldin Dasoo Deb Deguire Deluca Deremo Easterbrook Ebraemi Elliott Filip Flaherty Forsythe Forte Gagnon Geller Gerrior Ghandour Ginsberg

Municipality

Bowmanville Petawawa Kingston Etobicoke Richmond Hill Hamilton Porters Lake Kingston Oshawa Concord Thornhill London Toronto Downsview Newmarket Oshawa Brampton Hull Toronto Richmond Hill Cornwall Aurora Hamilton Scarborough Don Mills Dowling Aurora Kingston Guelph Mississauga Windsor Etobicoke Oshawa Nepean Oshawa Toronto Thornhill Scarborough Ottawa Thornhill

First

Warner D. Nato Antonio Brad J. Mohsen Zoltan Micheal Terrance Edwin R. Joseph Donna M. Ferdinando P. Goran Germain Jihad Mahmoud Ronald Nelson Michael J. Mohsen Mohammed M. Steve Byum-Joon Bozena S. Richard G.C. Richard Alfred

Last

Grainger Gratta Greco Gregoire Hamzeh Hegedus Hobbs Hoolans Houkayem Hunt Iaboni Iliev Jones Kaafarani Kazoun Kennedy Kenny Ketabian Khan Kim Kostrubiec Larose Leblanc

Municipality

Huntsville Hamilton Newmarket Ajax Richmond Hill Tottenham Smith Falls Bracebridge Pickering Gore Bay Richmond Hill Toronto Scarborough Windsor London Enterprise Kitchener Toronto East York Thornhill London Welland Clarence Creek London Willowdale Mississauga Richmond Hill Mississauga Stoney Creek Peterborough Kitchener Toronto Etobicoke York Napanee Sudbury North York Richmond Hill North York Richmond Hill

First

Stanley L. Mark Derek Robert Nick Ronio Adam A. Michael W. Juliana Helen Marc Terrance D. Nader Leslie C. Valeri Richard M. Josip Taimaz Thomas John A. Eman S. Mazen A. Eric Sengsourith Giovanni Leon Thomas H. Steven R. Eric Philip Mihail (Mike) Mitra Pierre Dumitrel Rick Dennis Carlo Roderick James Chian Fong Donald J. Franklyn J. Barry James Cyrus L. Fareeborz

Last

Munshaw Nebergall Nicholson Noel Odish Paprocki Pulles Rapaich Regnier Roach Samadzadegan Saville Schekotikhin Scollon Sebalj Shahinjou Sheresky Shihab Shihab Silaphet Siracusa Sivak Stange Stenhouse Stiles Tanev Tavakkoli Thibault Tofan Toulouse Vera Williamson Wong Wong Won Wong Won Woods Woods Zaraineh

Municipality

Beeton Braeside Bowmanville Gatineau Windsor London Mitchell Windsor Shannonville Tyendinaga Mohawk Territory Richmond Hill Bradford Toronto Windsor Kitchener North York Burlington Woodbridge Woodbridge Cambridge Maple North York Chatham Gatineau Ottawa Toronto Mississauga Lockarbor Hamilton Garson Cambridge Toronto Markham Toronto Toronto Hamilton Mississauga Scarborough

Jason Christopher Leitch Arash Raymond P. Francis Chee William B. William G. Paul Francis Razvan John C. Peter J. Orrett N. Greg Michael Allan John Ernest Sergio Alexander Lesanalshariyati Lewis Liew Livingston Long Macdonell Mandru Matte Mavroudis McKenzie McMullen McNabb Mentor Monzon

Dawson R.B. (Ray) Moore Aref Mosayebi

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The Dealer Standard Winter 2004

LICENCE APPEAL TRIBUNAL (LAT) CASES

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o accompany the list of refused and revoked salespersons, a selection of Licence Appeal Tribunal (LAT) decisions for 2003 has been included below. These decisions offer more background on why an individual or business would be refused registration.

For those new to the industry, this is how the process works: when the Registrar issues a proposal to refuse a new applicant or a proposal to revoke an existing registrant, the party subject to the proposal is allowed 15 days to file an appeal with LAT ­ an independent agency of the Ministry of Consumer and Business Services. The Tribunal schedules a hearing where evidence is presented and witnesses are questioned for both sides. The Tribunal then issues a written decision that either supports the Registrar's proposal or overturns it. For some cases, the Tribunal imposes terms and conditions for registration. Summaries from a selection of cases follow, but complete decisions are available on LAT's web site, www.lat.gov.on.ca

CASE: LIANA CAR SALES AND EMAN S. SHIHAB AND MAZEN A. SHIHAB

Liana Car Sales, Mazen A. Shihab and Eman S. Shihab were previously registered with OMVIC on or about February 4, 2000. An August 2000 inspection found the dealer did not have an office or sign identifying the dealership. A second inspection in May 2001 resulted in the same findings. Yet another inspection in May 2002 found the dealer did not have any books and records available. Other incidents include the sale of a 1994 Voyageur with failure to disclose it as salvage and the sale of a 1996 Ford Taurus to GTA Auctions without full disclosure of body damage. The Tribunal considered Mr. Shihab's admission to making a mistake in the sale of the Taurus, but found this "mistake" was an "attempt" by Mr. Shihab to mislead a potential purchaser in the interest of making a quick sale." Also, the Tribunal "does not believe the circumstances are appropriate to allow Mr. Shihab to maintain his registration to sell under further terms and conditions. Clear terms and conditions were imposed initially and they were not observed by Mr. Shihab." Registrations refused.

The Tribunal found this "mistake" was an "attempt" by Mr. Shihab to mislead a potential purchaser

A criminal record check indicated he had been found guilty and convicted on September 28, 2001 of fraud over $5000.00. It was also found that Houkayem failed to disclose his earnings and assets from 1992 to 1997 while on social assistance. During the periods November 1992 until May 1994, January 1995 until October 1995 and May 1996 until January 1997, the applicant repeatedly and falsely failed to disclose to Durham's Social Services Department any or all income from his employment. During these periods the Social Services Department overpaid the applicant $47,191.15 ­ all of which was not due. The applicant knew this money was not due and failed to make restitution of the $47,191.15 or any portion thereof. The Tribunal stated: "Such conduct illustrates a lack of honesty and integrity on the part of the applicant. The Act is designed to deny, if need be, applicants who by their conduct illustrate a lack of honesty and integrity in their dealings and personal and business affairs. The conduct shown by the applicant is a glaring example of dishonesty and a lack of integrity." Registration refused.

CASE: ANTONIO GRECO

The applicant was registered as a motor vehicle salesperson on August 31, 1983. On April 30, 2001 the applicant plead guilty to and was found guilty of using a Visa card issued by the TD Bank in the name of Frank Butler knowing the card was obtained through an offence.

CASE: JOSEPH B. HOUKAYEM

The applicant applied for registration as a motor vehicle salesperson on October 31, 2002. When answering question 9 of the application, Houkayem denied being convicted of an offence.

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The Dealer Standard Winter2004

LAT CASES

On June 13, 2002 the Court ordered the applicant be conditionally discharged on conditions. Included in the probation order was the condition the applicant make restitution in a total amount of $4,700.00 at the rate of $300.00 per month commencing October 3, 2002. The applicant has failed to make restitution as ordered. The Tribunal found "the evidence presented by the Registrar and not contested by the applicant, paints a picture of an individual whom the Registrar rightfully feels will not perform his duties as a motor vehicle salesperson with honesty, integrity and according to law." Registration revoked. $2,223.60. Deb also failed to truthfully disclose the reasons behind his dismissal from previous employment. The Tribunal found Deb deliberately withheld information from the Registrar and commented the charge and conviction arose directly out of Deb's employment which was indicative of his lack of honesty and integrity: "The recent general conduct of Deb is one of repeated deception, concealment and dishonesty. This conduct has been ongoing for some time and does not consist of one isolated instance and as such it gives the Tribunal, at this stage, little or no confidence in his ability to now, or in the near future, act in accordance with the law and with integrity and honesty. The Registrar has a statutory duty imposed upon him to ensure to the best of his ability that the public is not in jeopardy when dealing with motor vehicle salespersons and dealers. He would be derelict in his duty if, having regard to the recent, repeated and admitted material nondisclosures both to the Registrar and the motor dealer with whom he was so recently employed, were he not to have issued a proposal to refuse registration to Deb." Registration refused.

CASE: JENNIFER NORMA-JEAN DICKINSON

Jennifer Norma-Jean Dickinson o/a Tri-Town Auto Sales and Leasing was registered on May 20, 1998. The dealer has failed to comply with the requirements of the Retail Sales Tax Act and is indebted to the Ministry of Finance in the amount of $115,985.06 as of April 9, 2003. The Ministry contends two payment agreements have been broken by the applicant and that at least two cheques have been returned NSF. The Tribunal found "three and one half years of non-payment is sufficient reason to conclude that the applicant is not financially responsible in the conduct of its business." Registration revoked. Note: This decision is under appeal

The Tribunal found "three and one half years of non-payment is sufficient reason to conclude that the applicant is not financially responsible in the conduct of its business."

CASE: CIVIC AUTOS INC. AND RASHID DASOO

Civic Autos Inc. was registered as a motor vehicle dealer and Rashid Dasoo was registered as its only motor vehicle salesperson on or about January 22, 1997. Dasoo failed to comply with the Retail Sales Tax Act and is indebted by at least $46,000 to the Ministry of Finance for failing to remit tax due and to pay assessments when due. He also owes approximately $18,200.00 to the Ministry of Community, Family and Children's Services for family benefits paid out. No payments have been made on either indebtedness since the early 1990s. Registration revoked. Note: This decision is under appeal

CASE: SOUMEN DEB

The applicant completed and signed an application for registration as a motor vehicle dealer on November 11, 2002. In the application, Deb failed to disclose he was charged and convicted of attempted theft over $5000.00 and had consequently been sentenced to time served and received a conditional discharge and 18 months probation together with an order for restitution of

continued on page 6

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The Dealer Standard Winter 2004

LAT CASES

CASE: JOHN A. BUNTSMA

In stealing funds over a period of three years the Tribunal found Buntsma embarked on an ongoing course of dishonesty

continued from page 5

For the bank account to be overdrawn some thirteen times does not imbue the Tribunal with any sense of confidence in the applicant's financial position and his ability to be financially responsible

The applicant applied for registration as a motor vehicle salesperson on or about March 11, 2003. A criminal record search found the applicant engaged in conduct resulting in a charge for theft over $5,000. During his membership with the Royal Canadian Legion Buntsma became responsible for depositing cash receipts into the Legion's bank account which he failed to do or account for. On May 2, 2003 Buntsma plead guilty to the charge of unlawfully stealing cash money exceeding $5000 from the Royal Canadian Legion (Branch 428). The applicant was sentenced to 18 months imprisonment and ordered to pay compensation of $36,980.00 The Tribunal found Buntsma, who retired from police service in 1992, "did not dispute that he pled guilty to unlawfully stealing cash money in the sum of more than $36,000.00 from the Royal Canadian Legion (Branch 428). Nor did he dispute that he was found guilty as charged and received an 18 month conditional sentence coupled with a restitution order which to date he has not complied with.... In stealing funds over a period of three years that were donated for charitable purposes he embarked upon an ongoing course of dishonesty and of placing himself outside the law... The evidence before the Tribunal in this matter indicates an applicant who the Registrar is justified in not registering due to his recent criminal conduct which persisted for three years and which continued until it was discovered by an audit." Registration refused.

response indicating he incorrectly answered question 9 and thought he had checked off "yes" to indicate previous criminal convictions. Under oath before the Tribunal, Belfrutto admitted he intentionally lied on question 9. Registration refused.

CASE: SHIQER BAJRAMI

The applicant, sole proprietor of S.B. Auto Centre, applied for registration as a motor vehicle dealer on October 24, 2002. A credit check on the applicant found Bajrami owed the National Bank the amount of $16,000 and owed three separate creditors a total amount of $6,432.00. Pursuant to the credit check, it was found the Waterloo Regional Credit Union Limited obtained a default judgement against the applicant in the amount of $7,757.00. It was also found the applicant entered into a sales agreement with Waterloo Nissan, but failed to make payment to the National Bank. The applicant advised OMVIC he returned the vehicle when the financing interest rates changed from 8.7% to 18.7%, however the vehicle was actually repossessed by the bank. A copy of the sales contract clearly indicates the interest rate was 8.75%, not 18.7% as the applicant alleged. A credit check of S.B. Auto Centre revealed two of the business' cheques had been dishonoured and returned marked NSF. A bank statement for S.B. Auto was also obtained for the period September 20, 2002 to October 31, 2002 which indicated the account was overdrawn on 13 occasions during the time period. The applicant also owes the Ministry of Finance more than $11,000 under the Retail Sales Act. "For the bank account to be overdrawn some thirteen times during October 2002 does not imbue the Tribunal with any sense of confidence in the applicant's financial position and his ability to be financially responsible if he were to be registered by the Registrar." Registration refused. continued on page 12

CASE: MARIO BELFRUTTO

The applicant applied for registration as a motor vehicle salesperson in November 2002. On question 9 of the application Belfrutto denied having been convicted of an offence. A criminal record check revealed the following convictions: assault (1991) and 5 counts of trafficking narcotics (1992). When questioned by OMVIC about these convictions, Belfrutto provided a written

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The Dealer Standard Winter2004

INDUSTRY HEADLINES

OTTAWA-AREA CURBSIDER FACES CHARGES Eric Philip Stiles, 1481147 Ontario Inc. and 3908429 Canada Inc. are currently facing 21 charges under the Motor Vehicle Dealers Act for allegedly acting as an unregistered dealer. Stiles faces an additional 20 charges under the Business Names Act for allegedly carrying on business under names that weren't registered. Stiles is accused of operating under names such as University Housing, Enkas Security, Access Car and Truck Rental, Shur-Clean Maintenance, Napanee Plumbing and Heating, Discreet Escorts, Families, Canadian Historical Consultants and Jackson and Triggs Investments. Stiles also maintains a web site, www.autostiles.com. Mary Jane South, OMVIC's Deputy Registrar, warns that Stiles should be registered even if he only claims to be operating as a broker by connecting buyers and sellers. "Anyone who is in the business of negotiating the purchase, sale or lease of motor vehicles must be registered and that includes people referring to themselves as 'brokers'." CAR SALESMAN INVOLVED IN CAR-FLIPPING SCHEME FINED $50,000 The Canada Customs and Revenue Agency (CCRA) reported November 25th that Philippe Hahn, a former car salesman, was found guilty of evading payment of the goods and services taxes (GST) between April 1, 1996 and May 31, 1998 and was fined $50,000. While employed at a local car dealership, Mr. Hahn knowingly sold 35 vehicles, mainly Chevrolet Suburban and Tahoe models, to taxable automobile exporters. As sales to exporters are not allowed under the Manufacturers Franchise Agreement, Mr. Hahn knowingly put the vehicles in the names of Status Indians thereby not charging the GST and PST on the sale. Since delivery of the vehicle to a reserve is a necessary requirement to be GST exempt, Mr. Hahn would obtain fraudulent gasoline receipts for the vehicles from service stations either on or in the vicinity of the reserve. He also falsified letters certifying that the vehicles were delivered to a reserve and not intended for resale outside of Canada. As a result of the false paperwork provided by Mr. Hahn, the car dealership inadvertently understated the GST that should have been collected and remitted on their sales of vehicles for various monthly filing periods between April 30, 1996 and May 31, 1998. The total value of these sales was $1,428,570.00, resulting in the non-remittance of $100,000 in GST that has since been paid by the dealership. Hahn's registration as a salesperson terminated in July 1998. OTTAWA USED CAR DEALER FINED $16,000 FOR EVADING PROVINCIAL SALES TAX The manager of an Ottawa company that operated a used car dealership on Sieveright Road has been fined $16,000 and had to repay $71,706 in taxes owing. John Forsythe, manager of 1292162 Ontario Ltd. ­ which operates Canada Car Depot ­ pleaded guilty to two charges of directing or participating in the company's wilful evasion of provincial sales taxes. Justice of the Peace Kathleen Miller of the Ontario Court of Justice in Ottawa was told the Ministry of Finance Special Investigations Branch revealed the tax evasion, which occurred between August 1998 and December 2000. Court also heard the tax has been repaid. Miller fined Forsythe $16,000 and gave the corporation a suspended sentence. She granted Forsythe four months to pay the fine. Forsythe must also pay a surcharge of $4,000 to the Ontario Victims' Justice Fund, bringing the total court-imposed penalties to $20,000. In addition to the court imposed fines and surcharges, businesses convicted of tax evasion must repay the full amount of tax owing, plus civil penalties and interest. Forsythe's registration as a salesperson was revoked in September 2002. CURBSIDERS CHARGED On October 16th Mowafka Chams appeared in St. Thomas court and plead guilty to 4 counts of curbsiding. He was fined $5000.00 and placed on two years probation. His wife, Katharina Wall, received a suspended sentence and probation. In addition to fines, special conditions also restrict Chams and Wall from buying, purchasing or dealing in motor vehicles other than for their personal use. They are also restricted from attending wholesale auto auctions except to transport vehicles for registered dealers. During the investigation many calls were received from registered dealers in the Aylmer area who complained to OMVIC about the couple's curbsiding activities and misuse of dealer plates.

Anyone who is in the business of negotiating the purchase, sale or lease of motor vehicles must be registered and that includes people referring to themselves as 'brokers'

Dealers are also warned that Stiles is now soliciting used vehicles through fax and email requests

While employed at a local car dealership, Mr. Hahn knowingly sold 35 vehicles to taxable automobile exporters

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The Dealer Standard Winter 2004

CONCERNED ABOUT THIRD PARTY WARRANTIES?

So Are We

T

The Motor Vehicle Dealers Act does not regulate warranty companies, only registered dealers and salespersons

he following are proposed amendments to OMVIC's Standards of Business Practice concerning the provision or sale of thirdparty warranties by motor vehicle dealers. These were developed through the efforts of OMVIC's Industry Professionalism Committee. The Industry Professionalism Committee reports the following proposed changes to the Standards of Business Practice will help address many of the issues that have evolved due to third-party warranties, thus enhancing consumer protection and creating a level playing field for dealers who won't sell worthless warranty products. The Registrar is also working closely with the Ministry of Consumer and Business Services to develop new regulations which will re-enforce the efforts of the Committee. The Industry Professionalism Committee would like you to review the following and provide feedback: "The Motor Vehicle Dealers Act does not regulate warranty companies, only registered dealers and salespersons. Problems encountered by consumers with regard to some third party warranties are:

advertising of warranties provides insufficient disclosure some selling dealers neglect to forward the warranty documents to the warrantor language of the warranty significantly reduces the eligibility of claims, and in extreme cases, to the point where there is no coverage limitations of coverage are such that the cost of the warranty exceeds the value of claims after-purchase obligations imposed on the consumer exceed the value of the warranty after-purchase obligations are difficult for consumers to meet claims are handled by the warrantor in such a manner as to cost the consumer more than if no warranty existed some third-party warranty companies may not be placing sufficient monies in trust to cover costs of future claims

SUGGESTED AMENDMENTS

The following conditions shall apply to all warranties offered or sold by a dealer where the dealer is not the supplier of the warranty: 1) No motor vehicle dealer shall offer, provide or sell a warranty unless the agreement with the supplier empowers the dealer to act as the agent of the supplier. Where a warranty is offered, provided or sold to a consumer, the warranty application shall include full terms of the warranty including all relevant information regarding coverage and exclusions; and the warranty application shall have the following information disclosed in a prominent fashion on the face of the warranty application,

2)

(a) the name and address of the warranty holder (b) the make, model and manufacturer's serial number of the covered vehicle (c) name of the motor vehicle dealer (d) name of the supplier (if different from the dealer) (e) the name and signature of the person accepting the warranty application on behalf of the motor vehicle dealer (f) the following items to be initialed separately by the consumer: (i) the effective dates of the warranty coverage (ii) deductible (if applicable) (iii) all fees or costs to be paid by the consumer, at the time of purchase and during the life of the warranty (iv) maximum claim limits (v) gross liability (vi) an acknowledgement of maintenance obligations of the consumer (vii) whether or not the warranty is insured

3)

A duplicate copy of the warranty application with the signature of the consumer on it shall be given to the consumer, when the warranty application is completed by the customer and accepted by the motor vehicle dealer.

Warranty refers to any motor vehicle warranty, guarantee, service plan or similar protection other than that offered by a manufacturer.

4) Advertisements placed by or on behalf of a motor vehicle dealer, which offer warranties as available, whether or not included in the

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The Dealer Standard Winter2004

CONCERNED ABOUT THIRD PARTY WARRANTIES?

So Are We

vehicle price, shall indicate, in a prominent fashion, whether the warranty is insured, or uninsured and will indicate the name of the warranty company(ies).

The Industry Professionalism Committee requests your feedback on these suggested amendments

5) No warranty shall be represented as insured or advertised by or on behalf of a motor vehicle dealer as insured unless it is underwritten by an insurer that is licensed in the province of Ontario"

YOUR INPUT IS VALUABLE:

The Industry Professionalism Committee requests your feedback on these suggested amendments. Please send your thoughts, comments and other suggestions to omvic@omvic.on.ca (with the subject line "Warranty Amendments") or by fax to (416) 512-3757 by February 13, 2004.

AFRICAN EMAIL UPDATE Dealer Saves $350,000!

"Thanks in large part to your article, we avoided what could have been about a $350,000 risk to our company," writes Freightliner Mid-Ontario Inc. General Manager Ken Fox. After reading "You've Got Mail. African E-mail Scam Hits Home" in the last issue of The Dealer Standard, Fox immediately questioned an off-shore deal his used truck location had been working on. Fox and his associates had been negotiating the deal for several months and many communications were completed through e-mail and UPS with a South African trucking company. Fox says the salesman and sales manager at Freightliner were sure they had a live deal going. The purchaser couriered a bank draft from Barclays Bank in London, England for the amount of the purchase plus $50,000 for pre-paid shipping expenses, but overpaid by another $6,000. Freightliner's bank cleared the draft and Freightliner then requested a check for shipping expenses because the purchaser had a strict shipping deadline they were pressuring Freightliner to meet. This type of fraud, a twist on the Nigerian overpayment email scam, involves the purchase of goods on-line. A buyer agrees to purchase a product, provides a cheque or bank draft for more than the agreed price, makes an excuse for the overpayment and then asks the merchant to wire the excess funds back to other parties. Three Canadian dealerships have been scammed and other on-line sales outlets have been targeted including eBay. "Based on the facts in your article I questioned the transaction immediately," says Fox. "A phone call to Johannesburg found there was no listed number for either the supposed trucking company or the individual we were dealing with. Our bank's international division contacted Barclays the following day and discovered the bank draft was a total forgery. It's amazing the elaborate ground work that was in place to support this scam, and how close we were to being victimized. Hopefully our case will emphasize to dealers how real this threat is, and the extent these criminals will go to appear legitimate." Dealers are encouraged to take caution when dealing with buyers abroad ­ especially those in Africa where this fraud originated. An email recently received by OMVIC is typical of what might cause suspicion:

"Dear Sir, I am a car and bike dealer based in Africa and have branches in other parts of the world. I saw your advert placement on internet and i am interested in buying your car,Please forward me your final asking price only as my purchasing manager would handle the shipping and pick-up. Also indicate if you would accept a cashiers or certified check drawn from a u.s.a or canada bank for payment. I look forward to hear from you asap. please get back to through my personal email."

This type of fraud, a twist on the Nigerian overpayment email scam, involves the purchase of goods on-line

The signature for this e-mail included the surname "Momodu" which is listed on www.crimesof-persuasion.com as a typical alias used for Nigerian advance fee scams. The web site provides background on a variety of schemes, scams and frauds as well as discussion boards and useful links. If you do receive a deceptive e-mail it can be faxed to Phonebusters (operated by the OPP antirackets branch and the RCMP) at 1-888-654-9426. Its web site, www.phonebusters.com, also provides background on common scams.

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The Dealer Standard Winter 2004

UNSUNG HEROES More Reports of Community Involvement

The last issue of The Dealer Standard featured a profile of dealerships who are finding unique ways to give back to their communities ­ dealers who are wiling to host events and sponsor activities as a way of showing their community spirit. We are pleased to report the submissions are still coming in: HALDIMAND MOTORS LTD. ­ CAYUGA, ON For the last seven years Haldimand Motors Ltd. has hosted an event called "The Great Tricycle Race." Held in September, the purpose of the event is to show recognition to local service clubs and fire departments who generously donate time to the community. The evening starts off with a parade of local service clubs and fire departments and is followed by the real highlight ­ the tricycle race. Each of the service clubs and fire departments participating receives $300, but awards for parade costumes and themes, a wheelbarrow race and the tricycle race garner prize money of up to $5000. This past year just over $42,000 in prize money was awarded to 20 service clubs and 13 fire departments who use the funds to serve the community and improve local fire services. By offering door prize tickets in exchange for donations to local associations, Haldimand also ensures local volunteers and community programs benefit too. The dealership offered $30,000 worth of door prizes to encourage participation. This year the event drew a crowd of 6,000 ­ a real sign of the event's success. THE BÉLANGER FORD LINCOLN CENTRE ­ CHELMSFORD, ON The Bélanger Ford Lincoln Centre recently hosted the 2nd annual No Boundaries Car Rally in support of the Northeastern Ontario Cancer Treatment Centre. The event is organized by dealership staff who volunteer their time to support a worthwhile cause. This year's event raised over $6000 for the pediatric wing of the Cancer Centre. Forty teams registered for the event that General Manager France Bélanger-Houle looks forward to making a tradition in the community. HUMBERVIEW MOTORS AND JIM PEPLINSKI'S LEASEMASTER ­ TORONTO, ON Humberview Motors and Jim Peplinski's Leasemaster have been involved in supporting and fundraising for the United Way for the last 3 years. The 2003 campaign was its most successful ever with a grand total of over $41,000 raised. Every year a committee of employees is formed and events are organized in an effort to raise money. This year's events included a car wash that was held with the help of the Toronto Firefighters, the CN Tower climb, a hockey skills competition for minor league hockey players held in conjunction with the FAN 590, a Halloween bake sale, a dealership arm wrestling competition and pledge card donations. The Humberview Group reports its employees have not only succeeded in raising monies for a worthy cause, but have also had much fun along the way.

If your dealership is involved in community efforts, let us know. Fax submissions to: (416) 512-3757 or email omvic@omvic.on.ca.

For the last seven years Haldimand Motors Ltd. has hosted an event called "The Great Tricycle Race."

"HE DOES WHAT?" ...Used Car Dealer Wins Integrity Award

Congratulations to Mr. Krogman for reminding consumers and industry watchers that even used car dealers are worthy of integrity awards.

When it came time to announce a winner for the Better Business Bureau of Western Ontario's sixth annual Business Integrity Award, it was a Londonarea used car dealer that took the prize. And if local papers are to be believed, the idea of a car salesman grabbing top marks for integrity has come as a surprise given the industry is one that's "taken a beating over the years." Dennis Krogman of London, who started his dealership in 1973 with only three cars, was awarded at a ceremony held at the London convention centre. It was his catalogue of recommendation letters from clientele that impressed the award judges. It seems his long

standing policy of treating customers fairly and turning them into friends has reaped many rewards. With an inventory that now runs from 60 to 100 cars, Krogman says the last 30 years have been challenging, but fun. Aside from winning this integrity award, Krogman also remains active in the community by supporting Teen Challenge Farm, youth groups and Mission Services. Congratulations to Mr. Krogman of Dennis Krogman Auto Sales Ltd. for reminding consumers and industry watchers that even used car dealers are worthy of integrity awards.

THE OMVIC BOARD WOULD LIKE TO HEAR FROM YOU!

The Board of Directors of the Ontario Motor Vehicle Industry Council invites the dealer community to participate in its annual business planning process. OMVIC's Business Plan is a document which sets out OMVIC's principal targets, and highlights the strategies and measures which will be used to achieve goals for the coming years. This is your opportunity to let the Board know what you think OMVIC's priorities should be. Once received, survey results will be incorporated into OMVIC's Business Plan for the 2004-2006 period. Below, write down your ideas and suggestions for enhancing each of the three critical areas: dealer professionalism, consumer awareness and OMVIC's customer service. Once finished, please fax your response to: (416) 512-3757. If you require more space for your responses, feel free to include a second sheet.

Dealer Professionalism: _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________

Consumer Awareness: _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________

OMVIC's Customer Service: _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________ _________________________________________________________________

Page 12

The Dealer Standard Winter 2004

LAT CASES

continued from page 6 OMVIC Board of Directors

Ken Peterson Chair of the Board & President Ken Peterson Sales & Leasing Thunder Bay Al McDowell Vice President Southbank Dodge Chrysler Ottawa Gary Mackie Secretary Treasurer Gary Mackie Chevrolet Oldsmobile Tilbury Colin Abbot Car-o-line Auto Chesterville Kevin Bavelaar Auto Showplace Toronto Hugh Brennan Dixie Plymouth Chrysler Ltd. Brampton Sue Corke Ministry of Consumer and Business Services Jeff Gray Automobile Consumer Coalition Toronto Robert Positano Woodbine Pontiac Buick GMC Etobicoke Gerd Reisenecker Greenbelt Volkswagen Unionville Ron Scagnetti, Sr. Mid North Motors Sudbury Michael Turk Automobile Protection Association, Toronto

CASE: YOUNIS SABHAH YOUNIS O/A EAGLE CAR SALES

The Registrar refused registration based on the following reasons: I. The applicant acted as a motor vehicle dealer without being registered as a motor vehicle dealer under the Act. II. The applicant purchased vehicles using the registration identification number of another party. III. The applicant was found to be in possession of vehicles which he knew or ought to have known were stolen or revinned vehicles. IV. The spouse of the applicant reported a motor vehicle stolen and an insurance claim was made for the vehicle. The licence plate of the stolen vehicle was subsequently found in the possession of the applicant. The Tribunal found the evidence presented by the Registrar was "virtually unrefuted by the applicant" and "provides ample evidence that the applicant has not conducted his business affairs in an honest and forthright manner. The number of occurrences and extent of the applicant's activities provide ample and sufficient grounds for the Registrar to refuse to grant registration to the applicant." Registration refused.

CASE: RODERICK JAMES WILLIAMSON

The applicant completed and signed an application for registration as a motor vehicle salesperson on November 13, 2002. Registration was refused based on the applicant's criminal record and failure to make full disclosure of his criminal record on previous applications for registration. The applicant also had an outstanding warrant for his arrest. "The Tribunal finds that the Registrar has established on a balance of probabilities that the applicant has recently been convicted of fraud, an industry specific offence. There is a warrant for his arrest for the Fraud Over and the applicant is on probation involving a recognizance relating to a Family Law Act Restraining Order. The applicant's very recent and past conduct raises a strong concern, which requires the protection of the public." Registration refused.

The Dealer Standard

is published by the Ontario Motor Vehicle Industry Council 789 Don Mills Road, Suite 800 Toronto, Ontario M3C 1T5 T: (416) 226-4500 F: (416) 226-3208 Toll-free: 1-800-943-6002 www.omvic.on.ca Executive Director: Carl Compton Writer: Brenda McIntyre Design & Printing: Laservision Graphics Ltd.

Winter 2004 Volume 5 Number 1

Publication Mail Agreement #40021863 The Dealer Standard

789 Don Mills Road Suite 800 Toronto, ON M3C 1T5

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