Hiding negative equity or cash back

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An accurate and compliant bill of sale not only increases transparency and builds trust with your consumers, it acts as a written record of the transaction should any dispute arise.

Automotive businesses have an obligation to create and maintain complete and accurate financial records according to the Consumer Protection Act (CPA) 132(1) and the Automotive Business Regulation (ABR) Section 9. This includes, but is not limited to, a bill of sale.

 Some things to remember about the bill of sale:

  • The bill of sale should be fully completed, with only one final version of the bill of sale per transaction; and the consumer must be provided with a copy along with any other documents required to be attached to the bill of sale.
  • Must accurately reflect the nature of the transaction and must list any down payments, trade-ins, extra items, cash back, and any and all promises, offers or inducements at no extra charge, etc.
  • Any mandatory fees, charges, or costs that are on the bill of sale must have been included in the advertised all-in price for the vehicle (ABR, Section 31.2(j) and (l)).

Hiding negative equity or cash back by fraudulently inflating the purchase price of a vehicle on a bill of sale means the bill of sale is an inaccurate representation of the transaction and could also be a violation of all-in pricing, if the vehicle was advertised at a certain price. Even if a consumer or financial institution expresses a preference for negative equity or cash back to be hidden within a bill of sale, the automotive business, as a member of a regulated industry, is responsible to adhere to the CPA and associated legislation and disclose the true purchase price of the vehicle.

Remember, if a provision of a document is ambiguous, the provision must be interpreted against the business in accordance with Section 4 of the CPA. Review your bill of sale for accuracy and ensure you have included everything listed in the ABR Sections 31.2(1) and (2).

More information on extra fees, all-in pricing and even a bill of sale checklist are available on amvic.org.