OMVIC OMVIC Curbsiding and Illegal Sales Practices 3 — Questions and Answers
Question 1: Under the MVDA 2002, selling a motor vehicle 'in the course of trade' without OMVIC registration is considered:
- A minor administrative infraction requiring only a warning
- A civil matter between the buyer and seller only
- A provincial offence that can result in prosecution (Correct answer)
- Legal provided the seller discloses they are not a registered dealer
Correct answer: A provincial offence that can result in prosecution
Trading in motor vehicles without OMVIC registration is a provincial offence under the MVDA 2002, regardless of disclosure.
Question 2: Which of the following scenarios is LEAST likely to constitute curbsiding?
- A person who buys two cars at auction per week and resells them at a profit
- A person selling their own personal vehicle they drove for three years (Correct answer)
- A person who rotates through six different vehicles in one calendar year for profit
- A person flipping vehicles purchased at estate sales on a regular basis
Correct answer: A person selling their own personal vehicle they drove for three years
A single private sale of a personally-used vehicle does not constitute curbsiding; it becomes illegal when repeated for commercial profit.
Question 3: OMVIC's 'Bait and Switch' provisions under the Code of Ethics relate most closely to which illegal sales practice?
- Selling a vehicle at a price higher than advertised without customer consent (Correct answer)
- Requiring a customer to finance through the dealer's preferred lender
- Adding administration fees after the contract has been signed
- Selling a vehicle with a known mechanical defect without disclosure
Correct answer: Selling a vehicle at a price higher than advertised without customer consent
Bait and switch involves advertising a vehicle at one price to attract buyers and then substituting a different (usually more expensive) vehicle or price, which violates OMVIC's Code of Ethics.
Question 4: Which government body administers the MVDA 2002 and oversees OMVIC's regulatory authority?
- The Ministry of Transportation of Ontario
- The Ontario Securities Commission
- The Ministry of Public and Business Service Delivery (formerly MGCS) (Correct answer)
- The Financial Services Regulatory Authority of Ontario
Correct answer: The Ministry of Public and Business Service Delivery (formerly MGCS)
OMVIC operates as a delegated administrative authority under the Ministry of Public and Business Service Delivery, which administers the MVDA 2002.
Question 5: A registered OMVIC dealer employee who knowingly assists a curbsider in selling vehicles through the dealer's lot could face:
- Only a written warning from OMVIC
- Revocation of their salesperson registration and potential prosecution (Correct answer)
- A temporary suspension of their registration for up to 30 days maximum
- No personal consequences as responsibility lies with the dealership only
Correct answer: Revocation of their salesperson registration and potential prosecution
Individual salespersons who facilitate illegal sales can face loss of their own OMVIC registration and personal prosecution under the MVDA.
Question 6: When a curbsider's vehicle has an outstanding lien and the buyer later discovers this, what is the buyer's most significant legal disadvantage?
- The buyer cannot register the vehicle in their name
- The buyer has no right of recourse since they bought from an unregistered seller outside MVDA protections (Correct answer)
- The buyer must pay the lien but can deduct this from provincial sales tax
- The buyer can recover the vehicle's full value from OMVIC's Compensation Fund regardless
Correct answer: The buyer has no right of recourse since they bought from an unregistered seller outside MVDA protections
Without the MVDA protections that apply to registered dealer transactions, the buyer has very limited legal recourse for undisclosed liens on a curbsider purchase.
Question 7: How does curbsiding most directly harm the public?
- It reduces tax revenue for Ontario municipalities only
- It deprives consumers of MVDA protections and exposes them to potentially unsafe vehicles with undisclosed histories (Correct answer)
- It reduces competition for new vehicle dealerships
- It inflates used vehicle prices province-wide
Correct answer: It deprives consumers of MVDA protections and exposes them to potentially unsafe vehicles with undisclosed histories
Consumers who unknowingly buy from curbsiders lose all statutory protections, risking undisclosed accidents, hidden liens, odometer fraud, and no legal recourse.
OMVIC OMVIC Curbsiding and Illegal Sales Practices 3
Under the MVDA 2002, selling a motor vehicle 'in the course of trade' without OMVIC registration is considered: