OMVIC Code of Ethics Scenarios Flashcards

A registered salesperson receives a cash gift from a third-party financing company as a 'thank you' for directing customers exclusively to that lender, without disclosing this arrangement to customers. This conduct:

Answer: Violates the Code of Ethics because undisclosed financial benefits from third parties create conflicts of interest

Receiving undisclosed incentives from third parties that influence consumer referrals is a conflict of interest prohibited under the Code of Ethics regardless of the amount.

A consumer asks a salesperson whether the vehicle was previously used as a police car. The salesperson does not know but says 'No, definitely not' to avoid losing the deal. This statement:

Answer: Violates the Code of Ethics because making a definitive claim about an unknown material fact is misrepresentation

Asserting as certain a fact the registrant has not verified, especially to preserve a sale, is a misrepresentation regardless of intent.

A dealer principal learns that OMVIC is conducting a compliance audit of their dealership. The dealer instructs staff to alter records and speak only to the approved script during the audit. This conduct:

Answer: Violates the Code of Ethics and MVDA by obstructing a lawful OMVIC investigation

Obstructing or interfering with an OMVIC inspection is a serious violation of the MVDA and the Code of Ethics' requirement of professionalism and regulatory cooperation.

A salesperson who is leaving their current dealership to join a competitor takes a copy of the current dealership's customer database, intending to use it for prospecting at the new employer. Under the Code of Ethics and applicable law:

Answer: Taking the customer database without authorization is dishonest conduct and likely violates privacy law

Removing proprietary customer data without authorization is dishonest, contrary to the Code of Ethics, and likely violates PIPEDA and CASL.

A buyer is visibly intoxicated when they arrive to sign a vehicle purchase agreement. The salesperson proceeds with the signing to close the deal. Under the Code of Ethics:

Answer: The registrant should not proceed because a consumer must have capacity to consent to a binding agreement

Fair dealing and consumer protection principles require that consumers be capable of giving informed consent; proceeding with a sale knowing the consumer lacks capacity is unethical.

A registered salesperson's personal vehicle was repaired at a consumer's garage. The consumer then comes to the dealership to buy a car. The salesperson does not disclose this pre-existing business relationship. Under the Code of Ethics:

Answer: The prior business relationship should be disclosed to allow the consumer to decide if they wish to proceed with that salesperson

The Code of Ethics requires disclosure of any relationship that could affect the objectivity of the transaction; a prior financial relationship with the buyer is a potential conflict requiring disclosure.

A dealer receives a consumer's trade-in vehicle and discovers it has significant undisclosed frame damage after the transaction closes. The dealer believes the consumer knew about the damage. Under the Code of Ethics, the dealer should:

Answer: Address the matter professionally, including contacting the consumer directly if there is evidence of misrepresentation, rather than simply absorbing the loss or retaliating

The Code of Ethics requires professional conduct at all times, including when a dealer believes they have been harmed; retaliatory or self-help remedies outside proper channels violate the professionalism standard.