When should we be concerned about the relationship between debt consultants and bankruptcy trustees?

I can empathize with a bankruptcy trustee who not only has to compete for revenues with other trustees but also credit counselling agencies and debt settlement firms.

I can empathize with a bankruptcy trustee who not only has to compete for revenues with other trustees but also credit counselling agencies and debt settlement firms.

 

I do not envy bankruptcy trustees. Firstly, they have to spend a significant amount of money to run a financially viable business. While they receive compensation for facilitating Canadians making a consumer proposal or filing for personal bankruptcy many trustees feel that it is necessary to spend substantial sums on advertising. A trustee is competing for revenues with not only other trustees but also credit counselling agencies—most of whom benefit from favourable tax status–and debt settlement firms.

Secondly, a trustee is at a competitive disadvantage in terms of the number of people who might pay for their services. A consumer wishing to enter into credit counselling or hire a debt settlement firm is not legally required to meet with them in person. In contrast, bankruptcy trustees must meet in person with a person considering making a consumer proposal or filing for personal bankruptcy. Therefore, a credit counselling firm or a debt settlement firm could operate across Canada from a single office. Because a bankruptcy trustee can only make a consumer proposal or file a bankruptcy on behalf of someone they have met in person then a trustee’s revenue base faces major geographic limitations.

Finally, no one wants to speak to a trustee. The last person a person struggling with debt wants to speak with is a bankruptcy trustee. Canadians would rather speak to anyone—and I literally mean anyone–advertising “Avoid Bankruptcy”. A consumer with financial problems is more likely to contact a debt consultant, a credit counselling agency, or a debt settlement firm before they contact a bankruptcy trustee.

 

Some debt consultants act as significant funnels of referrals to bankruptcy trustees

Bankruptcy trustees across the country employ a number of different strategies for inviting consumers to contact their office and learn more about the benefits of making a consumer proposal or filing for personal bankruptcy. It is common for many trustees to spend a substantial amount of money on traditional advertising. Many trustees spend a significant amount of money on their website and internet advertising. Finally, some, but not all, trustees may generate a sizeable number of files from referrals from debt consultants.

 

Diverse group of debt consultants operating in Canada

Debt consultants come in all shapes and sizes. They provide advice or services to consumers struggling with debt. Some consultants have one or more licenses. Other debt consultants are not licensed. I am a debt consultant.  I provide advice for a fee to consumers who are struggling with unsecured consumer debt. The largest debt consulting firm in Canada is Four Pillars which has approximately 50 offices across Canada.

There is nothing inherently inappropriate with a bankruptcy trustee having a relationship with a debt consultant that results in generating files for a bankruptcy trustee. In certain circumstances, however, a trustee’s relationship with a debt consultant can violate the Office of the Superintendent of Bankruptcy Canada’s Code of Ethics for Trustees in Bankruptcy. It is not fair that bankruptcy trustees who scrupulously comply with the Code of Ethics as it relates to debt consultants should be at competitive disadvantage vis-à-vis a trustee who has an improper relationship with a debt consultant.

 

Improper for trustees to provide compensation or benefits for referrals

It is a contravention of the Code of Ethics of Bankruptcy Trustees for a trustee to pay, directly or indirectly, a fee, compensation or a benefit in return for a referral.

 

Trustees shall not encourage anyone to engage in any conduct which is illegal or dishonest with respect to the bankruptcy and insolvency process

It is a contravention of the Code of Ethics of Bankruptcy Trustees for a trustee to “assist, advise or encourage” any person to engage in conduct which is illegal or dishonest in connection to the bankruptcy and insolvency process.

It would be fair to say that the majority of trustees in Canada do not engage in conduct which would come close to violating the Code of Ethics of Bankruptcy Trustees. Unfortunately, there are some bankruptcy firms whose conduct as it relates to debt consultants might constitute a violation of the Code of Ethics or warrant an investigation by the Office of the Superintendent of Bankruptcy.

 

Link to Code of Ethics of Bankruptcy Trustees

Here is a link to the website where you can read the Code of Ethics of Bankruptcy Trustees.

 

Contact Mark Silverthorn if you have information about inappropriate relationships between debt consultants and trustees

Anyone who has information about inappropriate relationships between debt consultants and bankruptcy trustees is welcome to contact me at (866) 996-9941 or (519) 827-5513.  Alternatively, you can contact me via e-mail at mark@comprehensivedebtsolutions.ca.

 

If you believe that you have information about an inappropriate relationship between a debt consultant and a bankruptcy trustee then you are invited to contact me.

If you believe that you have information about an inappropriate relationship between a debt consultant and a bankruptcy trustee then you are invited to contact me.

 

 

Game changer: Credit Counselling Society enters debt settlement marketplace

 

This weekend I was doing a google search for the phrase “debt settlement” and I ended up on a webpage for the Credit Counselling Society.   This organization, headquartered in New Westminster, British Columbia, is one of the four titans of the Canadian non-profit credit counselling industry.  This organization has offices in every province west of Quebec.  According to its website, www.nomoredebts.org, the firm has 22 offices across a large part of Canada.

I almost fell of my chair when I read their webpage titled DEBT SETTLEMENT IN CANADA/ PROGRAM OVERVIEW.  You can find this webpage reproduced below.

 

CCSDebtSettlementpage

 

 

DebtSettlementpagesecondfromtop

DebtSettlementpagebottom3or3

This webpage appears on www.nomoredebts.org, the website for Credit Counselling Society, one of the four largest non-profit credit counselling agencies in Canada.  Purple circle has been added.

 

 

Credit Counselling Society has the potential to become the largest provider of debt settlement services in Canada

Because of it substantial financial resources and its 22 offices across Canada Credit Counselling Society has the potential to become Canada’s dominanat debt settlement services provider.  Its advertising budget is greater than all of the other debt settlement service providers in Canada combined.

 

 

Creditors support non-profit credit counselling agencies offering Debt Management Plans

The creditor community likes non-profit credit counselling agencies because they are essentially warm and fuzzy collection agencies.  Non-profit credit counselling agencies assist Canadian creditors recover tens of millions of dollars each year.  When a consumer completes a Debt Management Plan with a non-profit credit counselling agency the major banks and credit card companies recover 80 percent to 90 percent of monies owing to them–depending upon the amount of the “fair share contribution” a particular creditor pays to a non-profit credit counselling agency.

 

 

The credtior community is not favourably disposed towards debt settlement service providers

The creditor community, however, does not like debt settlement service providers.  Debt settlement involves a consumer making a one-time lump sum settlement–for an amount signficantly less than the current balance owing–as settlement in full.  It is common for creditors to agree to settlements where the consumer pays anywhere between 20 percent and 50 percent of the outstanding balance.

 

 

Creditors would prefer non-profit credit counselling agencies restrict themselves to providing Debt Management Plans

The creditor community would prefer that non-profit credit counselling agencies stick to enrolling Canadian debtors in Debt Management Plans and recovering 80 to 90 percent of monies owing to creditors.  The creditor community does not look favourably on debt settlement service providers–of any type–because creditors are only recovering 20 to 50 percent of monies owing to creditors.

 

 

Creditor community may threaten to stop making “voluntary donations” to the Credit Counselling Society

I was surprised to see the Credit Counselling Society openly advertising the organization’s debt settlement services on its website because this could invite a devastating reaction from Canada’s creditor community.  The majority of Credit Counselling Society’s revenues come from Canada’s big banks and major credit card companies in the form of “fair share contributions”.

Frankly, I am going to be surprised if the creditor community does not threaten to stop making fair share contributions to the Credit Counselling Society if it does not immediately stop not only providing debt settlement services, but also offering debt settlement services.  The risk of the loss of fair share contributions from major Canadian creditors should give Scott Hannah, the President and CEO of the Credit Counselling Society, cause for concern.

 

 

Canada’s Big Four non-profit credit counselling agencies

The vast majority of Debt Management Plans in this country are done through four major firms, all of which are non-profit credit counselling agencies:

  • Credit Counselling Society
  • Credit Canada Debt Solutions
  • Consolidated Credit Counseling Services of Canada Inc.
  • Credit Counselling Services of Atlantic Canada Inc.

Debt Management Plans are financially lucrative to firms that provide them in large volumes.  These four firms all run high-volume Debt Management Plan operations. Furthermore, these firms all compete aggressively with one another for Debt Management Plan clients.  Finally, these four firms compete with bankruptcy trustees and firms that offer debt settlement services.

 

 

Possibibility that the other major non-profit credit counselling agencies may enter Canadian debt settlement marketplace

There is a real possibility that if the Credit Counselling Society is advertising its debt settlement services to Canadians six months from now that one or more of Canada’s largest non-profit credit counselling agencies will decide to follow suit.

 

 

Contact me if you have any information about a credit counselling agency offering debt settlement services

I would invite anyone with information about a credit counselling agency offering debt settlement services to contact me.  You are welcome to call me at (866) 996-9941 or at (519) 827-5513.  Alternatively, you are welcome to contact me, via e-mail, at mark@comprehensivedebtsolutions.ca

 

You are welcome to call Mark Silverthorn if you have any information about a credit counselling agency offering debt settlement services.

You are welcome to call Mark Silverthorn if you have any information about a credit counselling agency offering debt settlement services.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

New Life Debt Solution: Debt settlement firm operating illegally in Ontario?

 

Last Friday I was returning home from a day at the CNE when my girlfriend noticed a sign on a traffic pole which read  “Are You In Debt? 905-783-1922”.  My girlfriend asked my daughter to take a photo of the sign with her cellphone.  This photograph can be found below.

AreyouinDebt

This photograph was taken on Friday, August 21st on Hurontario Street in Mississauga. 

 

My initial reaction was this sign was an ad for a debt settlement firm

On our drive home from the Port Credit Go Station to Kitchener we would pass literally hundreds of signs.  This was the only sign that we photographed on our drive home.  My girlfriend had the presence of mind to notice that this sign might have an interesting story behind it.  When I saw this sign my initial reaction was that it was an ad for a debt settlement firm.

 

Phone number belongs to firm called New Life Debt Solution

After returning home I googled (905) 783-1922 and I learned that it was the phone number for a Mississauga-based firm called New Life Debt Solution.  This firm’s website is www.newlifedebt.com.  According to the firm’s website the firm offers debt settlement services.

ServicesandSolutionstopofpage

This screenshot is taken from the top portion of New Life Debt Solution’s webpage titled SERVICES AND SOLUTIONS.  On this page the firm clearly states that it offers debt settlement services.

 

 

Three locations listed in Ontario

On the website’s LOCATIONS webpage three Ontario locations are listed.

Locations

According to its website, New Life Debt Solution is operating in Ontario, Quebec, Alberta, and British Columbia.

 

The firm’ website lists its Toronto location as 2898 Weston Road.  Earlier this week I had a meeting in the GTA.  At the conclusion of my meeting I drove to 2898 Weston Road to take a photograph of New Life Debt Solution’s Toronto office.  The photograph which appears below is a photograph of that address.

2898WestonRoadNewLifeDebtSolution

This is a photograph of 2898 Weston Road, the address listed as the Toronto location for New Life Debt Solution.

 

 

New Life Debt Solution does not possess an Ontario collection agency license

Under the Ontario Collection and Debt Settlement Services Act a firm cannot offer debt settlement services to Ontario residents unless it is licensed as a collection agency under the Act or it is exempt under the Act.  To the best of my knowledge New Life Debt Solution is not exempt under the Act.

Earlier this week I contacted the Ontario Government and I received written confirmation that New Life Debt Solution did not possess an Ontario collection agency license.

NewLifeDebtSolutionnotanONcollectionagency

This week the Ontario Government has provided me with written confirmation that New Life Debt Solution does not possess an Ontario collection agency license.

 

 

Mystery shopping call to New Life Debt Solution

At approximately 6:00 p.m. this evening one of my operatives called New Life Debt Solution’s toll free number, 1 (866) 210-9262.  This call was on speakerphone and I listened to the call and I made detailed notes during the call.

My operative–who I will simply refer to as Brenda–started this phone call by asking if she had reached New Life Debt Solution.  The man answering the phone replied yes.

At the beginning of the phone conversation the man clearly indicated that New Life Debt Solution offered debt settlement services.  Brenda stated that she owed $15,000 in unsecured consumer debt.

Based on my detailed notes taken during the phone call the following exchange took place concerning collection calls and the risk of being sued:

Brenda:  So I stop making payments to my creditors and I pay you instead?

Male:      Yes.

Brenda:  Will I get collection calls from creditors?

Male:      Absolutely not.  Collection calls will stop.  If anyone is trying to collect money from you the calls will stop immediately.

Brenda:  But what if they try and sue me?

Male:      Absolutely not.  We will protect you.  They cannot do anything.

Later in the call Brenda asked about how much it would cost her to hire New Life Debt Solution to provide debt settlement services for her.

Brenda:  Do you know what my payments would be to you for $15,000?

Male:     Approximately $100 per month.

Brenda: How many months?

Male:     60 months, 5 years, $100 per month for 60 months

Brenda: So $6,000 total?

Male:     Yes.

Near the end of this phone conversation Brenda asked the representative from New Life Debt Solution to e-mail her a copy of the firm’s debt settlement agreement which the representative declined to do.

 

Illegal for a debt settlement provider to charge fees prior to a settlement being paid out

Unless a debt settlement service provider is exempt from the Act, it is illegal for a debt settlement service provider to charge a penny in fees to an Ontario resident until such time that monies have been paid to a creditor under a settlement.  Accordingly, it would appear that New LIfe Debt Solution’s free structure contravenes the Ontario Collection and Debt Settlement Services Act.

Under the Act a consumer has the right to a 100 percent refund of any fees paid where the debt settlement service provider is in contravention of the Act.

 

 

New Life Debt Solution Inc. would appear to be a new player

Based upon a corporate search of New Life Debt Solution Inc., the company would apear to be a new entrant into the Canadian debt settlement marketplace.  According to a corporate search for New Life Debt Solution Inc. the firm was incorporated in British Columbia on June 23, 2015, about eight weeks ago.  The corporate search lists one director, Tahir Ahmad Malik.  The mailing address for the corporation is listed as 208-9200 120th Street, Surrey, British Columbia,  V3V 4B7.

The company’s website indicates that it has offices in Ontario, Quebec, British Columbia, and Alberta.

 

Complaint to be filed with the Ontario Government

Tomorrow I plan on filing a complaint with the Ontario Government against New Life Debt Solution.  It would appear that the firm is offering debt settlement services to Ontario residents in contravention of the Ontario Collection and Debt Settlement Services Act.

 

Contact me if you have paid any monies to New Life Debt Solution

I would invite anyone who has entered into a contract or given any money to New Life Debt Solution to call me at (866) 996-9941 or (519) 827-5513.  Alternatively, you can contact me via e-mail at mark@comprehensivedebtsolutions.ca.

If you are an Ontario resident and you have entered into a debt settlement agreement with CCDR then I would invite you to contact me.

If you are an Ontario resident and you have paid any monies to New Life Debt Solution I would invite you to contact me.

 

 

 

 

 

 

 

 

 

 

 

How to file a complaint to the Ontario Government against a collection agency or a debt settlement firm

 

It is possible to file a complaint against a collection agency or a debt settlement firm to the Ontario Government. In order for you to file a complaint it will be necessary for you to go through a two-step process.

 

Step One:   Send a written letter of complaint to the business

The Ontario Government will decline to process your complaint unless you first write a letter of complaint to the business in question.  In this letter you should describe the nature of your complaint against your business.  Furthermore, you should also state what actions by the business, if any, would resolve your complaint.

 

Step Two:   Submit a completed Complaint Form to the Ontario Government

Once you have made your written complaint to the business in question then you can file a written complaint to the Ontario Government using the Ontario Government’s Complaint Form which can be found online at the following link:

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

You can also find a copy of this 4-page Complaint Form reproduced at the end of this post.

You should also include copies of any relevant documents in connection with your complaint.  For example, if you are complaining about the conduct of a debt settelement firm, you might want to include copies of your debt settlement agreement as well as copies of correspondence between yourself and the debt settlement firm.

You have a number of options in terms of how you submit your Complaint Form.  You can submit your completed Complaint Form onlineYou can also print a Complaint Form and then submit it via e-mail, by fax, or by regular mail:

  • via e-mail to consumer@ontario.ca
  •  by fax, to (416) 326-8665
  • by mail to the following address:

Ministry of Government and Consumer Services

Consumer Protection Branch

Box 480

1201 Wilson Avenue, Building A

North York, ON  M3M 1J8

 

 

What happens to your complaint after it is submitted?

After your complaint is forwarded to the Ontario Government it will be be processed.  Complaints are input into the Ontario Government’s computer system and the complaint will be assigned a unique file number.   Complaints go through triage to determine the priority in which a particular complaint should be dealt with.  Those complaints which are deemded sufficiently serious are forwarded to an Investigations Unit.  Complaints alleging that a business is contravening Ontario law is more likely tobe  forwarded to an Investigations Unit.

 

Ontario Collection and Debt Settlement Services Act and Regulation 74

The conduct of both collection agencies and debt settlement firms is governed by the Ontario Collection and Debt Settlement Services Act and Regulation 74 enacted pursuant to the Act.  A complaint to the Ontario Government against a collection agency or a debt settlement firm alleging a violation of either the Ontario Collection and Debt Settlement Services Act or Regulation 74 will likely be treated more seriously than a complaint which does not involve conduct contravening these provisions.

You can find the Ontario Collection and Debt Settlement Services Act at the following link:

http://www.ontario.ca/laws/statute/90c14

 

 

Contact me if you would like to make a complaint against a collection agency or a debt settlement firm

You are welcome to call me at (866) 996-9941 or (519) 827-5513 if you have made a complaint, or you wish to make a complaint, regarding a collection agency or a debt settlement firm.  You can also contact me, via e-mail, at mark@comprehensivedebtsolutions.ca.

 

You are welcome to contact Mark Silverthorn if you have, or if you wish to file, a complaint against a collection agency or a debt settlement firm.

You are welcome to contact Mark Silverthorn if you have, or if you wish to file, a complaint against a collection agency or a debt settlement firm.

 

 

Complaint Form

The 4-page document reproduced below is the Complaint Form that must be completed by an Ontario resident who wishes to make a complaint against a collection agency or a debt settlement firm.  The Ontario Government will decline to process a Complaint Form unless a consumer first writes a letter of complaint to the business in question.

 

p1ComplaintForm

p2ComplaintForm

 

p3ComplaintForm

 

p4ComplaintForm

 

 

 

 

 

OCCA helps Deputy Judge Serafini and Ontario Debt Law enter debt settlement marketplace

 

Sometime shortly after June 30th of this year a new player, Ontario Debt Law (ODL), entered the debt settlement marketplace.  According to the firm’s letterhead, Ontario Debt Law’s address is in the same one-storey building as OCCA Consumer Debt Relief Inc., one of the largest debt settlement firms operating in Canada over the past decade.  OCCA’s 2014 submission to the Ontario Government states that the firm has 12,000 clients.

OCCASignage188WilkinsonRoadBramptonON

OCCA’s office is located at 188 Wilkinson Road, Unit 1, Brampton, Ontario.  The address appearing on Ontario Debt Law’s letterhead is 188 Wilkinson Road, Unit 2, Brampton, Ontario.

 

Oakville lawyer Angelo Serafini is the owner of Ontario Debt Law

The owner of Ontario Debt Law is lawyer Angelo Serafini. According to the Law Society of Upper Canada’s Lawyer and Paralegal Directory, Angelo Serafini practices law at an office located at 447 Speers Road, Unit 202, Oakville, Ontario.  In a letter dated August 12, 2015, on Ontario Debt Law’s letterhead, sent to a potential client Angelo Serafini is described as “currently a Deputy Judge”.

 

Timing of the emergence of Ontario Debt Law

The entrance of Ontario Debt Law into the Ontario debt settlement marketplace coincides with the new debt settlement regulatory regime that came into effect on July 1st of this year.   Effective July 1, 2015, whenever an Ontario resident enters into a debt settlement agreement there are significant restrictions on fees that can be charged whenever the debt settlement service provider is subject to the Ontario Collection and Debt Settlement Services Act.

A debt settlement firm cannot charge a debt settlement client a penny in fees until such time that a settlement is actually paid out.  Furthermore, the maximum fee that can be charged with respect to a single debt is 10 percent of the amount of the debt as of the date the debt settlement agreement was signed.

The new regulatory regime, and in particular the significant restrictions regarding fees, will have and is having, a devastating impact on firms providing debt settlement services to Ontario residents.  The new regulatory regime for debt settlement firms do not apply to lawyers who can bring themselves within an exemption contained in the Ontario Collection and Debt Settlement Services Act.  Accordingly, it is much more attractive financially for OCCA to provide debt settlement services in conjunction with a law firm than to do so on its own.

 

 

Ontario Debt Law is flying beneath the radar

Some industry observers might conclude that Ontario Debt Law is making a conscious effort to carry on business below the radar.  The law firm does not have a website.  There is no reference to Ontario Debt Law on Angelo Serafini’s LinkedIn Profile.  Neither is there any reference to Ontario Debt Law on the website for Mr. Serafini’s Oakville law practice, www.serafinilaw.ca.  Finally, as of August 13, 2015, there was no signage for Ontario Debt Law at 188 Wilkinson Road, Unit 2, in Brampton, Ontario, the address appearing on the law firm’s letterhead.

 

My discovery of the existence of Ontario Debt Law

The website for OCCA Consumer Debt Relief Inc. is www.occa.ca.  Website visitors on this site struggling with unsecured consumer debt are encouraged to call a toll free number, 1 (866) 873-6222.

OCCAhoempagetopportion

Visitors to OCCA’s website, www.occa.ca, are invited to call a toll free number, 1 (866) 873-6222.

 

This past week an Ontario resident, Jane Doe–not her real name–spoke to me after calling this toll free number on OCCA’s website.  Shortly after calling this toll free number, and speaking with a counsellor, Jane Doe received an e-mail from her counsellor–containing 11 pages of documents, including a debt settlement agreement–not from OCCA, but from an organization called Ontario Debt Law.

At the very end of this post you can read these 11 pages, in their entirety, that Ontario Debt Law sent to Jane Doe earlier this week.

One of the more interesting set of provisions in the Ontario Debt Law debt settlement agreement are those indicating that Ontario Debt Law can outsource a number of its obligations under the contract to OCCA.

 

 

One-page letter dated August 12, 2105, on Ontario Debt Law’s letterhead sent to Jane Doe

The first page of the 11 pages sent to Jane Doe earlier this past week is reproduced below.

 

 

p1ODLpackagemarkedup

This one page letter on Ontario Debt Law’s letterhead dated August 12, 2015, was sent to Jane Doe, an Ontario resident.  The address on this letter on Ontario Debt Law’s letterhead is 188 Wilkinson Road, Unit 2, Brampton, Ontario.  Certain text on this page has been highlighted.  The author of this letter is Monica Baci.

 

 

Odd information appearing on Ontario Debt Law’s letterhead

When I tried to fact check the contact information appearing at the bottom of Ontario Debt Law’s letterhead I was surprised by what I found.  This can be summarized as follows:

  • The local number which appears at the bottom of Ontario Debt Law’s letterhead is always answered by a fax tone
  • The toll free number which appears at the bottom of Ontario Debt Law’s letterhead is the phone number for a business called DebtHelpers.ca

 

Photograph of 188 Wilkinson Road, Unit 2, Brampton, Ontario

On Thursday, August 13th I attended in person at 188 Wilkinson Road, Unit 1 and Unit 2, Brampton, Ontario, in order to take some photographs.  The photograph which appears below is a photograph of 188 Wilkinson Road, Unit 2, Brampton, Ontario, the same address listed as Ontario Debt Law’s address on the law firm’s letterhead.

 

v2Unit2188WilkonsonRoad

This photograph was taken on Thursday, August 13, 2015 at 188 Wilkinson Road, Unit 2, Brampton, Ontario.  The name which appears on the door is QuickConnectSolutions.com.  Behind this door appears to be a wall made of cardboard.  This door contains a sign advising Canada Post to deliver mail addressed to Unit 2, 188 Wilkinson Road, to Unit 1, 188 Wilkinson Road.  This address, 188 Wilkonson Road, Unit 2, in Brampton is listed as the address for Ontario Debt Law on marketing material sent to an Ontario resident earlier this week.

 

Ontario Debt Law, Quick Connect Solutions and DebtHelpers.ca all list 188 Wilkinson Road, Unit 2, Brampton, Ontario, as their firm’s address

Ontario Debt Law lists 188 Wilkinson Road, Unit 2, Brampton, Ontario as the firm’s address on the firm’s letterhead.   The websites for both Quick Connect Solutions and DebtHelpers.ca also list 188 Wilkinson Road, Unit 2, Brampton, Ontario, as the address for their firms.

QuickCollectSolutionsAboutUS

According to the ABOUT US webpage on www.quickconnectsolutions.com, the firm offers telephony solutions to firms in the marketing, credit, collection, and debt purchasing industries.

 

 

MarkedupDebthelpscaAboutwebpage

According to the ABOUT page on www.DebtHelpers.ca the firm does marketing for a number of firms offering a variety of programs designed to assist consumers experiencing debt problems.

 

 

OCCA and Quick Connect Solutions have run afoul of CRTC because of use of robocalls

In 2013, following an investigation by the CRTC into the use of robocalls, OCCA and Quick Connect Solutions agreed to pay $69,000 and $11,000, respectively, in fines.  Ontario Debt Law not only operates from the same business address as Quick Connect Solutions but its retainer agreement with consumers states it can assign any of its obligations under the agreement to OCCA.

 

 

Nine questions for Angelo Serafini and Ed Portelli, President of OCCA

 

After researching Ontario Debt Law and its relationship with OCCA this past week I have nine questions for Angelo Serafini and Ed Portelli, the President of OCCA.

 

1.  Is it appropriate for Ontario Debt Law’s marketing material to refer to Angelo Serafini, the owner of Ontario Debt Law, as a Deputy Judge?

Earlier this week Jane Doe, an Ontario resident, received 11 pages of documents from Ontario Debt Law.  The first of these 11 pages is a one-page letter appearing on Ontario Debt Law’s letterhead.  You will find this one-page letter reproduced below.

The first two sentences of this letter on Ontario Debt Law’s letterhead read as follows:

Ontario Debt Law (ODL) is a Canadian law firm that is owned and operated by Angelo Serafini, J.D.  Angelo has been practising law for over 30 years and is currently a Deputy Judge.

Is it appropriate for a lawyer who is a Deputy Judge to state that he is a Deputy Judge on the firm’s marketing materials?  The fact that Ontario Debt Law’s marketing materials says that Ontario Debt Law is owned by Angelo Serafini who is currently a Deputy Judge might lead a potential client to conclude that Ontario Debt Law’s services are approved or recommended by the Ontario courts or the Ontario Ministry of the Attorney General.

 

2.   Is it misleading for OCCA’s website to advise consumers to avoid debt settlement when OCCA is actively encouraging website visitors to enter into a debt settlement agreement with Ontario Debt Law?

OCCA’s website contains a webpage titled “Avoid Debt Settlement”.  Anyone reading this webpage might conclude that consumers should not hire a firm to provide debt settlement services.  In fact, OCCA Debt Relief Inc. possesses an Ontario collection agency license which permits it to provide debt settlement services.  Furthermore, website visitors who call the toll free number appearing on OCCA’s website speak to a counsellor whose job it is to encourage the caller to enter into a debt settlement settlement agreement with Ontario Debt Law.  Finally, the debt settlement agreement from Ontario Debt Law which is sent to a potential client states that Ontario Debt Law will outsource some of its obligations under the agreement to OCCA.

 

3.     Is the marketing letter used by Ontario Debt Law misleading when it states “We are NOT a debt settlement firm!”

The Ontario Collection and Debt Settlement Services Act defines “debt settlement services” in paragraph 1(c) of the Act as follows:

“debt settlement services”   means offering or undertaking to act for a debtor in arrangements or negotiations with the debtor’s creditors or receiving money from a debtor for distribution to the debtor’s creditors, where the services are provided in consideration of a fee, commission or other remuneration that is payable by the debtor.

It is true that Ontario Debt Law is not a debt settlement firm which is licensed under the Ontario Collection and Debt Settlement Services Act.  However, Ontario Debt Law does offer debt settlement services to Ontario residents.  Furthermore, the agreement which Ontario Debt Law sends to potential clients states that some of the services offered under the agreement will be performed by OCCA.

Some industry observers might find the statement “We are NOT a debt settlement firm!” on Ontario Debt Law’s one-page marketing letter to be misleading.

 

4.  Why doesn’t Ontario Debt Law have appropriate signage for its office located at 188 Wilkinson Road, Unit 2, in Brampton, Ontario?

The address listed for Ontario Debt Law on a letter dated August 12, 2015, sent to an Ontario resident earlier this week is 188 Wilkinson Road, Unit 2, Brampton, Ontario.  When I attended at that address on August 13, 2015, the signage on the door at this address was not for Ontario Debt Law, but for a firm called QuickConnectSolutions.com.

When I visited 188 Wilkinson Road, Unit 1 and Unit 2, on August 13th I could not find any signage for Ontario Debt Law.  There is, however, signage in the vicinity of Unit 1 and Unit 2 of 188 Wilkinson Road, Bramtpon, Ontario, advising Canada Post to deliver mail addressed for 188 Wilkinson Road, Unit 2, to 188 Wilkinson Road, Unit 1.

NoticeforCanadaPostremailforUnit2188WilkinsonRoad

On August 13, 2015, when I visited 188 Wilkinson Road, Brampton, Ontario, I found this sign on the door for Unit 2 and on the door immediately to the right of Unit 1. 

 

5.   It is appropriate for the toll free phone number which appears on Ontario Debt Law’s letterhead to be that–not for Ontario Debt Law–but for a marketing firm DebtHelpers.ca?

 

6.   Is it appropriate for Ontario Debt Law to share office space with Quick Connect Solutions and DebtHelpers.ca and do they have any concerns about the security of clients’ confidential information?

Quick Connect Solutions provides telephony solutions to firms in the marketing, credit, collection and debt purchasing industries.  DebtHelpers.ca is a firm that provides marketing services for a number of firms that provide a variety of programs for consumers experiencing debt problems.  Is it appropriate for Ontario Debt Law to be sharing office space with Quick Connect Solutions and DebtHelpers.ca?  Does this arrangement raise any concerns about the security of the firm’s client information?

 

7.   Who is Moncia Baci’s employer?

Earlier in this post you can read a one-page letter dated August 12, 2015, on Ontario Debt Law’s letterhead sent to an Ontario residient.  The person whose name appears as the author of this letter is Monica Baci.  Who is Monica Baci’s employer?

According to Monica Baci’s LinkedIn Profile she is an employee of OCCA.

MonicaBaciLinkedInProfile

 

Is it appropriate for the name of an OCCA employee to appear as the author of a letter on Ontario Debt Law letterhead?

 

8.   Does Ontario Debt Law have a credible legal opinion confirming that its relationship with OCCA does not contravene any of the Rules of Professional Conduct governing lawyers in Ontario?

Earlier this week I came into possession of a copy of an agreement Ontario Debt Law is sending to prospective clients in Ontario.  The document informs potential clients that some of the services offered under the agreement would be performed by OCCA which is not a law firm.  Only time will tell whether or not this business model will attract scrutiny from not only those responsible for regulating debt settlement firms but also those responsible for regulating the conduct of lawyers in Ontario.

 

9.   Is Ontario Debt Law’s entrance into the Ontario debt settlement marketplace bringing the administration of justice in Ontario into disrepute?

Will the public’s perception of lawyers and the administration of justice be prejudiced by the activiteis of Ontario Debt Law and its existing business relationship with OCCA?

 

 

Opportunity for comments from Angelo Serafini and Ed Portelli

Angelo Serafini declined the opportunity to be interviewed in connection with this post.  Ed Portelli agreed to meet with me but he requested that any comments he  made during the interview were “off the record”.

 

 

Invitation to contact Mark Silverthorn if you have been in communication with marketing representatives from Ontario Debt Law

If you live in Canada and you have received documentation from Ontario Debt Law then I would invite you to contact me at 1 (866) 996-9941 or (519) 827-5513.  Furthermore, if you have spoken to a marketing representative from Ontario Debt Law and you have recorded the telephone conversation then I would invite you to contact me.  Alternatively, you are welcome to send me an e-mail at mark@comprehensivedebtsolutions.ca.

 

 

Copy of documentation sent by Ontario Debt Law to an Ontario resident on August 12, 2015

 

On August 12, 2015, an Ontario resident received 11 pages of documents from Ontario Debt Law after calling the toll free number on OCCA’s website and requesting information about its services.  These 11 pages are reproduced below.  Some content has been highlighted.

 

p1ODLpackagemarkedup

p2ODLpackage

 

p3ODLpackage

 

p4ODLpackage

 

p5ODLpackage

 

p6package

 

p7ODLpackage

p8ODLpackage

p9ODLpackage

p11ODLpackage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Saskatchewan-based CCDR stops accepting debt settlement clients from Ontario

 

In my most recent post on this blog, dated August 2nd, I wrote about a Saskatchewan-based debt settlement firm, Canadian Customer Debt Relief Inc. (CCDR).  This firm is licensed as a collection agency in both Saskatchewan and in Ontario. In my previous blog I indicated that on August 2nd I filed a formal complaint with the Ontario Government against CCDR.

That complaint was based upon questions I had as to whether or not CCDR satisfied certain legal obligations under Ontario law for a firm providing debt settlement services to Ontario residents.  More specifically, I had questions as to whether or not CCDR was negotiating settlements illegally on behalf of Ontario residents because it did not employ any full-time licensed collectors working from its registered office in Kitchener, Ontario.  I also raised concerns whether or not CCDR’s Ontario office, located in a Regus corporate business centre, satisfied the permanent Ontario office requirement in the Ontario Collection and Debt Settlement Services Act.

 

 

Reaction from CCDR to my recent blog posts

My August 2nd post on this blog and my LinkedIn post, dated August 2, 2015, on the same topic generated a strong reaction from Greg Roberts, one of the owners of CCDR.  On my Linkedin post on the same topic one can find the following comment from Greg Roberts:

CommentGregRobertsresponseLAug222015LinkedInpost

 

 

Invitation to Greg Roberts to appear together on talk radio program

I would welcome the opportunity to have Greg Roberts air any concerns regarding my recent posts in a public forum. To that end I would be happy to be a guest–together with Greg Roberts–on a radio talk show.  This would provide Greg Roberts with ample opportunity to respond to issues which I have raised on social media about CCDR over the past week.

 

According to this screenshot from ask.me Greg Roberts, of Canadian Customer Debt Relief Inc., is a Saskatchewan resident.

Greg Roberts has described Mark Silverthorn on social media as an “unprofessional coward”

 

 

Accordingly, earlier today I sent an e-mail to Canadian Customer Debt Relief Inc. (CCDR) inviting Greg Roberts to join me in participating on a radio talk show.

August92015emailMStoGregRobertsradioappearance

 

 

CCDR is advising the public it “no longer” offers debt settlement services to Ontario residents

One of the questions I would like to ask Greg Roberts is why–less than a week after I made my formal complaint to the Ontario Government against his firm–CCDR is advising the public that it “no longer” offers debt settlement services to Ontario residents.

This week I was given an e-mail dated August 7, 2015, in which a representative from CCDR advises an Ontario resident “we no longer accept clients in the Ontario region”.  Here is a copy of this e-mail.

August72015gmailCCDRnoservicestoONresidents

 

What are CCDR’s long-term plans for offering debt settlement services to Ontario residents?

Canadian Customer Debt Relief Inc. (CCDR) possesses an Ontario collection agency license and, therefore, it is legally permitted to provide debt settlement services to Ontario residents.  For some reason, this week CCDR is declining to offer debt settlement services to Ontario residents.  Some might wonder what are CCDR’s long term plans in connection with offering debt settlement services to Ontario residents?  Is the firm going to change its existing business model which might involve a signficant expenditure on its part?  Alternatively, is the firm considering withdrawing from the Ontario debt settlement marketplace for a period of time–or perhaps permanently?  Might there be a third option CCDR is considering?

 

Copies of debt settlement agreements with Canadian Customer Debt Relief Inc.

If you are an Ontario resident and you have entered into a debt settlement agreement with Canadian Customer Debt Relief Inc. (CCDR) then I would like to speak with you.  You are welcome to call me toll free at (866) 996-9941 or (519) 827-5513.  Alternatively, you can contact me via e-mail at mark@comprehensivedebtsolutions.ca

 

If you are an Ontario resident and you have entered into a debt settlement agreement with CCDR then I would invite you to contact me.

If you are an Ontario resident and you have entered into a debt settlement agreement with CCDR then I would invite you to contact me.

 

 

Canadian Customer Debt Relief Inc.: Satisfying debt settlement industry’s best practices?

 

A couple of weeks ago someone asked me to look at the website for a debt settlement firm called Canadian Customer Debt Relief Inc., also known by its initials, CCDR.  The firm’s website is https://ccdr.ca.  According to the homepage for this company’s website, CCDR is licensed as a debt settlement firm in both Saskatchewan and in Ontario.  At the bottom of the webpage titled “DEBT SETTLEMENT RED FLAG” the following sentence is prominently displayed:

We are proud to say that Canadian Customer Debt Relief Inc. adheres to the best practices in the industry.

 

MarkedUpBottomRedFlagDebtSettlementOHL

This screenshot is taken from the bottom of the webpage titled “Debt Settlement Red Flag” on CCDR’s website (Orange highlight has been added).

 

Four questions for CCDR’s ownership

After reviewing the firm’s website, researching various government sources and social media, and visiting the firm’s Ontario office, I have four questions for the firm’s Canadian owners.

Is CCDR’s ownership hypocrites?

Is CCDR adequately safeguarding its clients’ personal information?

Is CCDR misleading the public about the consequences of entering into a debt settlement agreement?

Is CCDR negotiating settlements on behalf of Ontario clients illegally?

 

 

1.      Are CCDR’s owners hypocrites?

Despite the fact that CCDR is licensed to provide debt settlement services in both Saskatchewan and in Ontario the company is essentially a Saskatchewan-based firm.  On the CONTACT page for the firm’s website its Saskatchewan office is described as the “Saskatchewan Head Office” and “All customer support and new inquiries are handled here.”  Furthermore, a corporate search of the firm lists a Saskatchewan address as the firm’s head office and all of the firm’s directors are Saskatchewan residents.

The homepage for CCDR promotes the firm as the preferred choice as a debt settlement service provider for Saskatchewan residents.  The website’s homepage goes so far as to discourage consumers from using “out-of-province” debt settlement firms.  After reading this blog post, some people might think CCDR’s website is hypocritical warning consumers to avoid hiring out-of-province debt settlement firms.  This Saskatchewan-based firm is offering debt settlement services to Ontario residents in circumstances where it has virtually no presence in Ontario.  CCDR’s concerns for consumers using an out-of-province debt settlement firm would appear to be limited to Saskatchewan residents–and not the residents of Ontario.

 

This screenshot is the top portion of the homepage on CCDR's website.

This screenshot is the top portion of the homepage on CCDR’s website.

Highlighting has been added to this screenshot of the top portion of CCDR’s homepage.

 

 

2.         Is CCDR adequately safeguarding clients’ personal information?

On the homepage for CCDR’s website one can find the statement “No appointment is necessary you may call or drop in”.  CCDR’s registered Ontario office is located at 55 King Street W., 7th Floor, Kitchener, Ontario, N2G 4W1.  Since I just happen to live in Kitchener, Ontario, I thought I would take CCDR up on its invitation to drop by its office.

Recently I visited 55 King Street, 7th Floor in Kitchener, Ontario, which I discovered is a Regus corporate business centre.

CCDR's registered Ontario office is located at a Regus corporate business centre in Kitchener, Ontario.

CCDR’s registered Ontario office is located at a Regus corporate business centre in Kitchener, Ontario.

 

One of the very friendly Customer Service representatives at Regus was only too happy to give me a tour of the entire 7th floor.  When I provided the Regus Customer Service representative with the name of my firm, Comprehensive Debt Solutions Inc., she volunteered that Canadian Customer Debt Relief Inc., was one of their clients that shared an office with one of more other firms.  During our tour of the 7th floor my Customer Service representative from Regus showed me the actual office which CCDR shared with other firms, an office with six workstations and very little else.

My Regus tour guide also volunteered that the representatives from CCDR are “rarely here”.  When I asked about a desktop computer sitting at an empty workstation the Regus Customer Service representative identified it as the CCDR computer.  Later that day this Regus Customer Service representative confirmed that six individuals–not all of whom were CCDR employees–had keys to the shared office where CCDR’s computer was located.

Given this information, CCDR might want to ask themselves if their clients’ financial information is being adequately safeguarded.  With respect to maintaining the confidentiality of client information is CCDR adhering to the “best practices in the industry”?

 

 

3.       Is CCDR misleading the public about the consequences of entering into a     debt settlement agreement?

Over the past few days I have thoroughly reviewed the content on CCDR’s website.  There are two issues where I found the content on https://ccdr.ca to be misleading:

  • statements suggesting that people entering into a debt settlement agreement with CCDR would not receive collection calls
  • failure to mention that a client entering into a debt settlement agreement with CCDR might get sued

The following screenshot is Question 16 on CCDR’s FAQ webpage where the issue of stopping collection calls is referred to.

 

Highlights have been added to this screenshot taken from FAQ page on CCDR's website.

Highlights have been added to this screenshot taken from FAQ page on CCDR’s website.

 

I am perplexed by the representation contained in Question 16 on CCDR’s FAQ page that CCDR can stop collection calls to a consumer who becomes a client within about a week.  In fact, there is no law–no provincial law in either Saskatchewan or Ontario, nor federal law–which confers on a debt settlement firm the right to stop collection calls to its debt settlement clients.  CCDR might very well send a letter to a client’s creditors demanding that all phone calls be made to CCDR and not its client.  The creditor, and its authorized collection agent, however, have every right to make collection calls to any consumer owing it money, including anyone who has entered into a debt settlement agreement with CCDR.

The content on CCDR’s website contains a number of statements about the positive results that are available if an individual enters into a debt settlement agreement with CCDR.  What I was not able to find anywhere on CCDR’s website was a statement indicating that a creditor might sue a consumer who had entered into a debt settlement agreement with CCDR.

 

 

4.      Is CCDR negotiating settlements illegally on behalf of Ontario residents?

The Ontario Government has a regulatory regime for firms providing debt settlement services which is contained in the Ontario Collection and Debt Settlement Services Act and Regulation 74.  There are three different types of licenses under this Act.

  • collection agency license
  • branch office licene (required where a firm operates from multiple locations)
  • collector license (required for employees performing certain functions)

Under the Act a firm providing debt settlement services to Ontario residents–except those exempt from the Act–must possess an Ontario collection agency license.  If a firm providing debt settlement services to Ontario residents operates from more than one location then each location requires a branch office license.

Furthermore, some, but not all, employees of a firm offering debt settlement services to Ontario residents must possess a valid Ontario “collector” license.  Individuals who negotiate settlements on behalf of Ontario residents are required to be licensed as a collector under the Act.  Furthermore, a collector is only permitted to perform these debt settlement functions while physically present on the premises listed on their collector registration.  Subsection 13(8) of Regulation 74 of the Ontario Collection and Debt Settlement Services Act reads as follows:

(8)   A collector shall be registered where he or she is to be employed by a registered collection agency.

Canadian Customer Debt Relief Inc. possesses an Ontario collection agency license with a registered office located at 55 King Street W., 7th Floor, Kitchener, Ontario, N2G 4W1.

 

This screenshot taken from an Ontario Government website confirms that Canadian Customer Debt Relief Inc. possesses a valid Ontario collection agency license and provides its registered office address in Kitchener, Ontario.

This screenshot taken from an Ontario Government website confirms that Canadian Customer Debt Relief Inc. possesses a valid Ontario collection agency license and provides its registered office address in Kitchener, Ontario.

 

 

 

I have written confirmation that Canadian Customer Relief Inc. does not have any branch office licenses that would permit its collectors to work at any address other than its registered office in Kitchener.

Furthermore, I have written confirmation that Canadian Customer Debt Relief Inc. has two collectors licensed under the Ontario Collection and Debt Settlement Services Act.: Gregory Roberts and Rachelle Roberts.  You will find a screenshot confirming their license status below:

This screenshot from an Ontario Government database confirms that Gregory Roberts is licensed as a collector under the Ontario Collection and Debt Settlement Services Act and is licensed to work at 55 King Street West, 7th Floor, Kitchener, Ontario.

This screenshot from an Ontario Government database confirms that Gregory Roberts is licensed as a collector under the Ontario Collection and Debt Settlement Services Act and is licensed to work at 55 King Street West, 7th Floor, Kitchener, Ontario.

 

 

 

This scrdeenshot from Ontario Government website confirms that Rachelle Roberts is licensed as a collector under the Ontario Collection and Debt Settlement Services Act and she is entitled to work as a collector at 55 King Street w., 7th Floor, Kitchener, Ontario.

This scrdeenshot from Ontario Government website confirms that Rachelle Roberts is licensed as a collector under the Ontario Collection and Debt Settlement Services Act and she is entitled to work as a collector at 55 King Street w., 7th Floor, Kitchener, Ontario.

 

 

 

CCDR’s two licensed collectors are both Saskatchewan residents

A corporate search of Canadian Customer Debt Relief Inc. reveals that CCDR’s two Ontario collectors, Gregory Roberts and Rachelle Roberts, are directors and shareholders of the company.  A copy of the first page of a corporate search of Canadian Customer Debt Relief is reproduced below:

screenshottopportionp1CCDRcorpsearch (2)

screenshotbottomportionp1corpsearchCCDR (2)

 

A search of social media confirms that both Gregory, or Greg, Roberts, and Rachelle Roberts,  CCDR’s two licensed collectors under the Ontario Collection and Debt Settlement Services Act, are Saskatchewan residents.

According to this screenshot from ask.me Greg Roberts, of Canadian Customer Debt Relief Inc., is a Saskatchewan resident.

According to this screenshot from ask.me Greg Roberts, owne off Canadian Customer Debt Relief Inc., is a Saskatchewan resident.

 

RachelleRobertsLinkedInProfileexcerpt

 

RachelleRobertsHealthandWellnessaddress

 

 

I don’t know whether or not CCDR has any Ontario clients for whom it provides debt settlement services.  I do know, however, that CCDR has gone to the time, trouble, and expense, to obtain an Ontario collection agency license, obtain a shared office in Kitchener, Ontario, place a computer in that shared office, and obtain two Ontario collector licenses.  I also know that CCDR is offering debt settlement services to Ontario residents on the firm’s website.

There would appear to be some issue as to whether or not CCDR is complying with Ontario law when it comes to negotiating settlements on behalf of any of its clients who are Ontario residents. CCDR does not employ anyone as a licensed collector who works full-time at the firm’s registered office located in Kitchener, Ontario.  In fact, the firm’s two licensed collectors live more than 1,900 kilometers from the firm’s registered office in Kitchener, Ontario.  Therefore, one wonders how CCDR can legally negotiate settlements on behalf of its Ontario clients when it does not employ a full-time licensed collector who works at the firm’s registered Kitchener office.

 

Official complaint has been filed with the Ontario Government

Given my concerns about whether or not CCDR might be contravening the Ontario Collection and Debt Settlement Services Act in connection with negotiating settlements on behalf of Ontario residents who are clients of the firm, I have taken the liberty of filing a formal complaint against the firm with the Ontario Ministry of Government and Social Services.

 

Any Ontario residents who are clients of CCDR invited to contact me

If you live in Ontario and you are an existing or former debt settlement client of Canadian Customer Debt Relief Inc. I would invite you to call me at (866) 996-9941 or (519) 827-5513.  Alternaively, you are welcome to send me an e-mail at mark@comprehensivedebtsolutions.ca.

If you are an Ontario resident and you are a client of CCDR then you might want to contact Mark Silverthorn.

If you are an Ontario resident and you are a client of CCDR then you might want to contact Mark Silverthorn.

 

 

 

 

 

 

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

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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.

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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.”

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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.

 

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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.