Archive for July 2015

How to cancel a debt settlement agreement and obtain a full refund

Some Canadians enrolling in a debt settlement agreement might be entitled to a refund in the thousands of dollars.

Some Canadians enrolling in a debt settlement agreement might be entitled to a refund in the thousands of dollars.

 

Over the next few weeks and months a substantial number of Canadian consumers entering into a debt settlement services agreement will not only be able to cancel the agreement but also obtain a full refund of all the payments they made under the agreement.  That is, if they take appropriate action.  In some cases, a consumer might be able to obtain a refund in the thousands of dollars.

The right to cancel a debt settlement services  agreement is available with some, but not all, agreements entered into on or after July 1, 2015.  These rights are not available to consumers, however, where the debt settlement firm is exempt from the Ontario Collection and Debt Settlement Services Act.

 

Who has the right to cancel an agreement and receive a full refund of monies paid?

These two rights, the right to cancel a debt settlement services agreement, and the right to a refund of all monies paid to a debt settlement firm—is available to the following consumers:

  • Any Ontario resident who entered into a debt settlement services agreement after June 30, 2015
  • Any person residing outside Ontario who entered into a debt settlement services agreement with a firm located in Ontario after June 30, 2015

If you are going to enter into a debt settlement services agreement you should make sure that the debt settlement firm does not back date the agreeement to a date prior to July 1, 2015.  This tactic by an unscrupulous debt settlement firm might deprive you of the important protections for consumers afforded under the Ontario Collection and Debt Settlement Services Act.

 

The right to cancel a debt settlement agreement

A consumer has an absolute right to cancel a debt settlement agreement, at any time within 10 days of receiving a written copy of the debt settlement services agreement. There are also two specific situations where a consumer who has entered into a debt settlement agreement can obtain relief within 365 days of a specific event.

The following chart summarizes the relief that is available to a consumer under the Ontario Collection and Debt Settlement Services Act with respect to both cancelling a debt settlement services agreement and obtaining a refund for payments made to a debt settlement firm which are not lawfully permitted under the Act.

R1ChartReliefundertheAct

Fees:    With respect to any debt settlement service agreements entered into after June 30, 2015, a debt settlement service provider is not entitled to charge a client a penny in fees until such time that a settlement is actually paid out.  Once a debt is settled–and only then–is a debt settlement firm entitled to charge a fee under a debt settlement services agreement. This fee cannot exceed 10 percent of the original amount owing on the date the consumer entered into the debt settlement agreement.

 

Mandatory requirements:   The mandatory requirements for a debt settlement services agreement are contained in paragraphs 1 through 6 of subsection 27(1) of Regulation 74, R.R.O 1990, 309/14, enacted pursuant to the Ontario Collection and Debt Settlement Services Act.

A copy of these provisions is reproduced below with the relevant provisions highlighted in yellow for clarity.

 

YHsections1and2subsection271

YHsections34and5subsection271

YHsection5subsection271

One of the provisions in this Regulation is that the first page of any debt settlement agreement must be a document titled Settling Debt–What You Need to Know, a copy of which can be found on an Ontario Government website.  You can find a copy of this document at the very end of this post.

 

Requirement to provide written notice of cancellation of agreement

In order to cancel a debt settlement agreement a consumer must provide the debt settlement service provider with notice.  What constitutes adequate notice is set out in subsection 92(1) of the Ontario Consumer Protection Act, which is reproduced below.

section92CPA

 

If a consumer wanting to cancel a debt settlement agreement also seeks a refund of payments made to a debt settlement firm it would be prudent for the consumer to provide the debt settlement provider with written notice using a method where the consumer can later prove such notice was received by the debt settlement firm.  Depending upon how much time a consumer has to provide notice, a consumer might want to consider providing such notice by XPress Post, overnight courier, or registered mail.

Furthermore, this written notice should include a demand for the return of all monies paid to the debt settlement firm under the agreement.

 

 

Debt settlement firm’s obligation to refund monies within 15 days

Where a consumer who is entitled to cancel a debt settlement agreement cancels the agreement within the relevant time period, and satisfies the notice requirement, then the debt settlement service provider has 15 days from the date of receipt of notice of cancellation to refund any monies owing to the consumer under Ontario law.

If the debt settlement firm fails to provide a refund within 15 days then the consumer has a number of options:

1.       File a complaint with the Ontario Ministry of Government and Consumer Services

A consumer can make a complaint to the Ontario Government where a debt settlement service provider fails to provide him with a refund.  In order to make an official complaint to the Ontario Government a consumer must first send a written notice to the debt settlement firm complaining about its conduct and stating the remedy sought and then it must file a complaint using the Ontario Ministry of Government and Consumer Services’ online Complaint Form.  Here is an online link for this form:

https://www.consumerbeware.mgs.gov.on.ca/esearch/compform/english/complaint.jsp

 

2.       Sue the debt settlement service provider in an Ontario court

Where a debt settlement firm fails to refund monies to a debt settlement customer in accordance with Ontario law then the consumer has the option of suing the debt settlement provider in an Ontario Court.  Where a consumer sues a debt settlement provider successfully then the court has the discretion to award exemplary or punitive damages.

 

Provide us with a copy of your debt settlement agreement entered into after June 30, 2015

If you have entered into a debt settlement agreement after June 30, 2015 then I would invite you to call me at (866) 996-9941 or at (519) 827-5513.  Alternatively, you can send me an e-mail at mark@comprehensivedebtsolutions.ca

 

You are invited to contact me if you have entered into a debt settlement agreement after June 30, 2015.

You are invited to contact me if you have entered into a debt settlement agreement after June 30, 2015.

 

 

Copy of document titled Settling Debt–What You Need to Know

Under the Ontario Collection and Debt Settlement Services Act the following document must be the first page of a debt settlement services agreement that is entered into after June 30, 2015.

 

SettlingYourDebtTopportion1of4

Settling Your Debt 2nd from top

SettlingYourDebt3rdfromtop

SettlingYourDebt4thfromtop

 

 

 

 

 

 

Complete Debt Solutions and the smoking gun

 

Those who follow the Mark Silverthorn Blog might recall that on June 22, 2015 I wrote a post titled “Complete Debt Solutions Operating in Canada Illegally?”  In that post I raised the question whether or not a firm based in Toronto, Ontario, carrying on business under the name Complete Debt Solutions was operating in one or more Canadian jurisdictions illegally as a debt settlement firm.

I became aware of the existence of Complete Debt Solutions after receiving a tip, from one of my hundreds of contacts, about the firm’s website, www.completedebtsolutions.ca.  A portion of the CONTACT page from this website is reproduced below.

 

This screenshot includes the bottom half of the CONTACT page on www.completedebtsolutions.ca.

This screenshot includes the bottom half of the CONTACT page on www.completedebtsolutions.ca.

 

 

Complete Debt Solutions is an Ontario-based debt settlement firm offering debt settlement services to Ontario residents

On its website Complete Debt Solutions lists its business address at 1075 Bay Street,  Suite 149, Toronto, Ontario.  I recently came into possession of 13 pages of material which Milton Kaseke, the principal of Complete Debt Solutions, e-mailed on or about June 22, 2015, to an Ontario resident making inquiries about the organization’s services. A redacted copy of the first page of these 13 pages is reproduced below (yellow highlights have been added for clarity).

YHREDP1CDScontract

On this page Milton Kaseke, who describes himself as a Senior Account Executive, confirms that “Complete Debt Solutions (C.D.S.) is a Debt Relief/Debt Settlement/Debt Negotiation and Credit Repair company located in Toronto Ontario Canada.”

 

 

Debt settlement providers require a collection agency licene

Subject to the following two exceptions, a firm must possess a license–typically a collection agency license (or a debt repayment agency license in Alberta)–in order to legally provide debt settlement services.

  1. a few Canadian provinces might not require a debt settlement provider to be licensed
  2. in some Canadian provinces and territories a law firm might be exempt from the requirement of obtaining a collection agency license

 

Complete Debt Solutions is not licensed in any province or territory as a collection agency

After I wrote my initial post on June 22, 2015, concerning the activities of Complete Debt Solutions I began making inquiries concerning the status of Complete Debt Solutions across the country.  I contacted, some, but not all, of the regulators in various provinces responsible for supervising the conduct of debt settlement service providers.  I was unable to identify a single province or territory where Complete Debt Solutions possessed a collection agency license.

You can imagine my surprise when on Friday, July 17, 2015, I received a phone call from Milton Kaseke, the principal of Complete Debt Solutions.  After advising me that he was not a fan of my June 22nd posts on both LinkedIn and the Mark Silverthorn Blog he confirmed that Complete Debt Solutions does not possess a collection agency license in a single province or territory in Canada.

 

E-mail from Milton Kaseke in which he states Complete Debt Solutions does not charge consumers for its services

On June 23, 2015 I received an e-mail from Milton Kaseke, the principal of Complete Debt Solutions.  In this e-mail Mr. Kaske states that “I haven’t taken any penny from anybody which means that I am not breaking the law (Collection and Debt Settlement Services Act of Ontario).”  This e-mail is reproduced below.

 

MiltonKasekeemailtoMS

Mr. Kaseke is correct when he says that a firm offering debt settlement services to Ontario residents does not need to possess a valid Ontario collection agency license if the firm is not receiving any compensation for its services.

The question that remains to be answered is whether or not Complete Debt Solutions and Milton Kaseke are offering debt settlement services to Ontario residents in circumstances where potential clients must pay a fee to Complete Debt Solutions.

 

Complete Debt Solutions would appear to be offering debt settlement services in return for financial compensation

As noted earlier, I recently came into possession of 13 pages of material that Milton Kaseke of Complete Debt Solutions e-mailed on or about June 22, 2015 to an Ontario resident inquiring about debt settlement services offered by the firm.  This material contains a 2-page contract for debt settlement services titled “Complete Debt Solutions Service Agreement”.  The first page of this document is reproduced below (yellow highlight has been added to some of the most pertinent portions of text).

 

YHP8topportionCDScontractBottomportinP8CDScontract

—————————————————————————————————————-

 

According to the first page of this debt settlement agreement Complete Debt Solutions charges its clients an Administration Fee.  In the middle of the first page of this 2-page debt settlement agreement a potential client is advised that he is responsible for paying to Complete Debt Solutions an “Administration Fee equal to 13% (thirteen percent) of the Client’s total enrolled debt.”

 

Official complaint made to the Ontario Government on or about June 24th

About a month ago, after spending a signficant amount of time reviewing the content on Complete Debt Solutions’s website I thought it would be appropriate to ask the Ontario Government to make inquiries and determine whether or not Complete Debt Solutions was operating as an illegal debt settlement service provider in contravention of the Ontario Collection and Debt Settlement Services Act.  Accordingly, I wrote a letter dated June 22, 2015, to Doug Kariam, Ontario’s Acting Registrar of Collection Agencies, requesting that his office investigate the matter. The following day I completed and submitted the appropriate online Complaint Form used by the Ontario Ministry of Government and Consumer Services.

The Ontario Ministry of Government and Consumer Services refuses to process a complaint against a business unless a consumer first writes a letter of complaint directly to the business in question.  Some people might think that this requirement is not only bad policy but also a direliction of the Ontario Registrar of Collection Agencies’ statutory duty to enforce the Ontario Collection and Debt Settlement Services Act.  In order to satisfy this “written notice requirement” I sent an e-mail to Milton Kaseke of Complete Debt Solutions on June 23, 2015, a copy of which is reproduced below.

 

June232015EmailMStoMScomplete

 

Furthermore, I forwarded copies of my letter to Doug Kariam to several of his counterparts in a number of provinces across the country.  I asked them to make inquiries to determine whether or not the activities of Complete Debt Solutions warranted an investigation in their province to determine if the law regulating debt settlement firms was being contravened.

On Friday, July 17, 2015, I sent an e-mail to Doug Kariam, Ontario’s Acting Registrar of Collection Agencies.  In that e-mail I provided a copy of the 13 pages of material that Milton Kaseke e-mailed to an Ontario resident on or about June 22, 2015, which I refer to in this post.  You can read a redacted copy–with the name of the consumer removed–of this material, in its entirety, at the end of this post.

I am not privy to what action the office of the Ontario Registrar of Collection Agencies has taken to date in response to my official complaint regarding the activities of both Complete Debt Solutions and its principal, Mr. Milton Kaseke.  Nor am I privy to the actions which might be currently underway in other provinces as a result of my communications with Doug Kariam’s counterparts in other provinces.  I would hope that my complaint receives the attention that is warranted under the circumstances.

 

Contact Mark Silverthorn if you have recevied a debt settlement agreement from Complete Debt Solutions

If you have received a debt settlement agreement from Complete Debt Solutions I would invite you to contact me.  I would also invite anyone who has received a debt settlement agreement from any other debt settlement service provider to contact me.  I can be reached at (866) 996-9941 or (519) 827-5513.  Alternatively, you can contact me via e-mail at mark@comprehensivedebtsolutions.ca

You are invited to contact Mark Silverthorn if you have received a debt settlement agreement  after June 30, 2015.

You are invited to contact Mark Silverthorn if you have received a debt settlement agreement.

 

 

 

Redacted copy of 13 pages of material sent from Complete Debt Solutions to an Ontario resident on or about June 22, 2015

P1redactedCompleteDebtSolutiosn

P2redactedCompleteDebtSolutions

 

P3redactedCompleteDebtSolutions

 

P4[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-004

P5[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-005

P6[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-006

P8[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-008

P9[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-009

P10[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-010

P11[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-011

P12[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-012

P13[name redacted] - CompleteDebtSolutions Client Enrollment Package - Copy-page-013

 

TDF Debt Advisory Law PC is rolling the dice

 

July 1st of this year marked the first day of a new regulatory regime for firms offering debt settlement services to Ontario residents.  The new regulatory regime regime contained in  the Ontario Collection and Debt Settlement Services Act applies to both firms offering lump sum settlements as well as those offering settlements by way of monthly installment payments–commonly referred to as credit counselling.  The focus of this blog post is those firms that negotiate one-time lump sum settlements on behalf of clients–and not  those firms offering to settle outstanding accounts by way of monthly installment payments.

 

Draconian restrictions on fees for debt settlement service providers

Except where a debt settlement provider is exempt from the Act, the new regulatory regime places onerous restrictions as to a debt settlement provider’s compensation.  With respect to any debt settlement agreement signed after June 30, 2015, a debt settlement provider is not entitled to receive a penny in fees until such time that a settlement is actually paid out.  Furthermore, the amount of fees that a debt settlement firm can charge is capped.  The maximum fee that can be charged for settling a debt is an amount equal to 10 percent of the amount of the debt on the date of enrollment in the debt settlement agreement.

An example will help illustrate the resrictions on fees.

On July 2, 2015, ABC Debt Settlement Inc. entered into a debt settlement contract with John Smith who has one ourstanding credit card with an outstanding balance of $10,000.  Seventeen months after signing this contract ABC Debt Settlement Inc. settles this debt for $5,000.  The maximum fee that ABC Debt Settlement Inc can charge John Smith is $1,000 or 10 percent of his $10,000 indebtedness on the date of his enrollment into his debt settlement agreement..  ABC Debt Settlement Inc. is not entitled to charge John Smith any fees whatsover until the date that the settlement is actually paid out.

Prior to July 1, 2015, the Ontario Government did not restrict the amount of fees that a debt settlement firm could charge.  Debt settlement firms would often charge fees equal to 15 to 20 percent of the amount of the consumer’s debt, plus a $50 monthly fee for the life of the debt settlement agreement.  Prior to July 1, 2015, a debt settlement firm that enrolled a client into a $10,000 debt settlment plan might generate somewhere between $2,000 and $4,000 in fees and the fees were not contingent upon whether or not a settlement was actually paid out.  Debt settlement firms would typically start charging fees in the first month that a client enrolled in a debt settlement plan.

 

Lawyers exempt from the Act and substantial restrictions on fees

Except where a debt settlement provider is exempt from the Act, the new restrictions on fees apply to any debt settlement agreement signed after June 30, 2015.   Except where a debt settlement provider is exempt from the Ontario Collection and Debt Settlement Services Act, the debt settlement service provider must not only charge fees in accordance with the Act but also it must be licensed as a collection agency in Ontario and comply with the Ontario regulatory regime for collection agenccies.

The most important exemption under the Ontario Collection and Debt Settlement Services Act is for lawyers.  The “lawyer’s exemption” can be found in paragraph 2(1)(a) of the Act and it reads as follows:

2.(1)  This Act does not apply,

(a)   to a barrister or solicitor in the regular practice of his or her profession or to his or her employees;

In order for a law firm to be exempt from not only the punitive restrictions on fees contained in the Ontario Collection and Debt Settlement Services Act and the necessity of being licensed as a collection agency it must be able to fall within this exemption.

 

Debt settlement services offered by TDF Debt Advisory Law PC

Sometime in June of this year a law firm by the name of  TDF Debt Advisory Law PC, based out of Whitby, Ontario, began offering debt settlement services.  This law firm operates from the same premises as Total Debt Freedom Inc., a firm which has been one of the largest providers of debt settlement services to Ontario residents over the past 10 years.

July62015TDFDebtLawhomepagetop

 

If you go on the homepage for Total Debt Freedom Inc.’s website, www.totaldebtfreedom.ca, there is a link to the homepage for TDF Debt Advisory Law PC’s website, www.debtconsolidationlaw.ca.

 

If you visit the homepage for TDF Debt Advisory Law PC then a representative from TDF Debt Advisory Law PC will attempt to start an online chat with you. Over the past week I exchanged messages with representatives of this law firm using this online chat feature.  I learned, for example, that TDF Debt Advisory Law PC offers debt settlement services to the residents of every province and territory in Canada.

Yesterday, I communicated with these online representatives of TDF Debt Advisory Law PC and it became evident that these individuals do not work on site at TDF Debt Advisory Law’s Whitby office.  When I asked one representative if he was working from the firm’s Whitby office he replied “I am not allowed to share my location.”

July122015LocationTDF

 

The following exchange occured yesterday when I asked the online representative from TDF Debt Advisory Law PC the name of the receptionist at the law firm’s Whitby office and a ball park number with respect to the number of employees who worked at the law firm.

 

July122015noofemployees

 

 

Entrance of TDF Debt Advisory Law PC into the Canadian debt settlement marketplace

TDF Debt Advisory Law PC began offering debt settlement services to the public on its website sometime in June of this year.  The consensus among executives in the Ontario debt settlement industry is that TDF Debt Advisory Law PC was created in response to the new restrictions on fees that debt settlement providers can charge to Ontario residents.  I would be very surprised if TDF Debt Advisory Law PC’s fee structure is consistent with that which other debt settlement providers in Ontario must comply with–those which must possess an Ontario collection agency license.

 

Law firms which comply with the Act should be entitled to “lawyer’s exemption”

When the Ontario Legislature enacted the Ontario Collection and Debt Settlement Services Act it made a policy decision that a “barrister or solicitor in the regular course of his profession and his or her employees” is entitled to an exemption from the Act.  There are a number of law firms operating today in Ontario which would certainly seem to be entitled to fall within the “lawyer’s exemption” in the Ontario Collection and Debt Settlement Services Act.   I believe that TDF Debt Advisory Law PC is not  one of them.  The business model used by TDF Debt Advisory Law PC, in conjunction with Total Debt Freedom Inc., would appear to be an amateurish attempt to circumvent the Act.

 

Caught by the Act’s anti-avoidance provision?

The Ontario Collection and Debt Settlement Services Act contains an anti-avoidance provision in section 2.1 of the Act that reads as follows:

2.1     In determining whether or not this Act applies to an entity or transaction, a court or other tribunal shall consider the real substance of the entity or transaction and in so doing may disregard the outward form.

At some future date an Ontario judge might rule, relying upon this anti-avoidance provision, that debt settlement agreements offered by TDF Debt Advisory Law PC are subject to the Act because TDF Debt Advisory Law PC is not exempt from the Act under the “lawyer’s exemption.  Furthermore, I believe that a court could make a finding that TDF Debt Advisory Law PC and Total Debt Freedom Inc. constitute a single entity which is providing debt settlement services in contravention of the Act.

 

TDF Debt Advisory Law PC’s huge gamble

I believe that TDF Debt Advisory Law PC is throwing the dice and that it is taking a huge gamble  There are four key areas where TDF Debt Advisory Law PC is potentially vulnerable.

  1. Ontario Registrar of Collection Agencies might take some action against the firm
  2. Potential action by provincial regulators outside of Ontario responsible for regulating the conduct of debt settlement providers in their province
  3. Law Society of Upper Canada might take some action
  4. Client(s) of TDF Debt Advisory Law PC might sue the law firm claiming a contravention of the Act, and if successfull, they would be entitled to 100 percent refund of fees and  punitive and exemplary damages

 

Copies of debt settlement agreements entered into after June 30, 2015

If you have signed a debt settlement agreement after June 30, 2015, with either TDF Debt Advisory Law PC or Total Debt Freedom Inc. then I would invite you to contact me at either (866) 996-9941 or  (519) 827-5513.    Furthermore, I would extend this invitation to anyone who has signed a contract after June 30, 2015, in which you pay for services and one or more of the services provided to you is negotiating a one-time lump sum settlement on your behalf.

 

 

 

 

 

 

Who is in charge at TDF Debt Advisory Law PC?

 

On the Mark Silverthorn Blog you can read a blog post dated June 30, 2015, titled “TDF Debt Advisory Law PC:  new debt settlement service provider”. TDF Debt Advisory Law PC, a Whitby, Ontario-based law firm appears to have begun operations sometime in June of this year.

TDF Debt Advisory Law PC’s website, www.debtconsolidationlaw.ca, does not contain much information about which provinces and territories where the law firm offers debt settlement services.  I assumed that over the next several months I would learn where this law firm was offering debt settlement services.

 

My recent experience with the law firm’s online chat feature

Imagine my surprise when a representative from TDF Debt Advisory Law PC provided me with this information yesterday. On Sunday, July 5th, I just happend to visit the homepage for TDF Debt Advisory Law PC’s website and I was surprised to see something new–an online chat box in which a representative from TDF Debt Advisory Law PC invited me to communicate.  Having nothing better to do I spent the next couple of hours chatting with one or more representatives from TDF Debt Advisory Law PC and capturing screenshots of our communications for posterity.

I have two take-aways from my exposure to TDF Debt Advisory Law PC over the past week:

  1. The firm is offering its services in every province and territory in Canada
  2. I have no idea as to who is actually running this law firm

 

TDF Debt Advisory Law PC is offering debt settlement services across Canada

Mr. Ronan Levy, the lawyer operating TDF Debt Advisory Law PC, is licensed to practice law in Ontario and the law firm’s address is in Whitby, Ontario.  Therefore, it would seem reasonable to conclude the TDF Debt Advisory Law PC offers debt settlement services to Ontario residents.  What is unclear from TDF Debt Advisory Law PC’s website, www.debtconsolidationlaw.ca, is where the firm is offering debt settlement services to Canadians outside of Ontario.

During this online chat I was able to specifically ask the representative from TDF Debt Advisory Law PC if the law firm provided debt settlement services in a particular province or territory.

Here is the answer when I asked about offering services to Quebec residents.

July52015Quebecresidents

 

Here is a screenshot of the answers for the four Atlantic provinces:

July52015NB July52015TDFNfldandLabrador July52015TDFNS July52015TDFPEI

 

Here are the answers for the three territories:

July52015TDFNunavut July52015TDFNWT July52015TDFYukonTerritory

 

I was able to ask a question about all four of the western provinces, with the exception of British Columbia, before the online chat box disappeared from TDF Debt Advisory Law PC’s website.  Here are the answers for Alberta, Saskatchewan, and Manitoba:

July52015TDFAlbertaresdients July52015TDFMB July52015TDFSK

 

Legal basis for an Ontario lawyer providing debt settlement services to Ontario residents

In Ontario a firm which provides debt settlement services to Ontario residents must be licensed as a collection agency under the Ontario Collection and Debt Settlement Services Act, unless it falls within an exemption under the Act.  This Act does contain an exemption for lawyers.  It remains to be seen, however, whether or not a court will rule that TDF Debt Advisory Law PC can bring itself within the lawyer’s  exemption under the Act.  If an Ontario court were to rule that TDF Debt Advisory Law PC is not exempt under the Ontario Collection and Debt Settlement Services Act then it would be required to obtain an Ontario collection agency license and its ability to generate fees would be dramatically diminished.

 

Legal basis for an Ontario lawyer to provide debt settlement services to Canadians outside of Ontario

Some, but not all, provinces have laws similar to Ontario requiring debt settlement providers to have a specific license–a collection agency licence or a debt repayment license–unless they are exempt from the Act.  In some of these provinces, provincial agencies responsible for regulating debt settlement firms take the position that an Ontario lawyer is not entitled to rely upon the “lawyer’s exemption” in their provincial statute and must be licensed as a collection agency in the province where the debt settlement services are being offered.

This means that TDF Debt Advisory Law PC might find itself in a position where one or more regulators, responsible for regulating debt settlement firms in a particular province, take the position that TDF Debt Advisory Law PC must obtain the necessary collection agency license (or debt repayment license) in order to carry on business in that province. If TDF Debt Advisory Law PC were required to be licensed under provincial law like any other debt settlement provider then TDF Debt Advisory Law PC’s ability to generate fees would be substantially reduced.

 

Who is running this law firm?

I have been following this law firm for less than a week and the question that I keep asking myself is who is running this law firm?

Here are some of the reasons why I ask this question:

  • TDF Debt Advisory Law PC shares the same premises with Total Debt Freedom Inc., a company which has been one of the largest debt settlement providers in Ontario over the past 10 years
  • There are reciprocal links between Total Debt Freedom’s website and that of TDF Debt Advisory Law PC
  • As of July 5, 2015, Richard Cooper, the President of Total Debt Freedom Inc., has contributed more blogs to TDF Debt Advisory Law PC’s website than Ronan Levy, the Ontario lawyer who operates TDF Debt Advisory Law PC
  • I find it hard to believe that a member of the Ontario bar vetted the language on the website for TDF Debt Advisory Law PC
  • I am surprised that the website for TDF Debt Advisory Law PC has an online chat feature in which a representative of the firm advised me that the firm offered debt settlement services in every Canadian province and territory

Ontario has a new debt settlement regime in place effective July 1, 2015.  As far as any debt settlement agreements signed with an Ontario resident are concerned, any debt settlement agreement signed after that date severely restricts the fees that a consumer can be charged.  That is, unless you are exempt from the Ontario Collection and Debt Settlement Services Act. Some people might think that the new restrictions on fees for debt settlement service providers in Ontario commencing July 1, 2015, and the recent entrance of TDF Debt Advisory Law PC into the Ontario debt settlement marketplace are related events.

If you would like to discuss the new Ontario debt settlement regime or you have a question regarding debt settlement or debt coaching then I would invite you to call me at  (866) 996-9941 or (519) 827-5513.  Alternatively, you can send me an e-mail at mark@comprehensivedebtsolutions.ca.

You might want to call Mark Silverthorn and learn more about this issue.

You might want to call Mark Silverthorn and learn more about this issue.