Administrative Penalties
The Consumer Protection Act

Process Description

Purpose and Intent

The purpose of the administrative penalty process in section 136 of The Consumer Protection Act is to encourage compliance with specific consumer protection requirements in the Act by establishing a fair and timely process to respond to situations of non-compliance. The process also provides affected businesses with the opportunity to appeal the decision to impose an administrative penalty.

Readers should note that this information sheet is for general purposes only and is not intended to be advice. The following are links to the Provice of Manitoba disclaimer and copyright information:

http://www.gov.mb.ca/legal/disclaimer.html
http://www.gov.mb.ca/legal/copyright.html

Legislation

The following is a link to The Consumer Protection Act:

http://web2.gov.mb.ca/laws/statutes/ccsm/c200e.php

The following are links to Regulations that contain administrative penalties:

http://web2.gov.mb.ca/laws/regs/pdf/c200-227.06.pdf
http://web2.gov.mb.ca/laws/regs/pdf/c200-098.07.pdf
http://web2.gov.mb.ca/laws/regs/pdf/c200-191.06.pdf
http://web2.gov.mb.ca/laws/regs/pdf/c200-099.07.pdf
http://web2.gov.mb.ca/laws/regs/2009/003.pdf

Description of The Administrative Penalties

The following is a list of provisions that contain requirements that may be dealt with by an administrative penalty. The sections refer to The Consumer Protection Act except where specifically noted:

1. Prominence of Annual Percentage Rate (APR) Disclosure - s. 13(2)
2. APR for a representative transaction - s. 13(3)
3. Advertising interest-free periods - s. 14(1)
4. Grace period conditions - s. 14(2)
5. Disclosure of term and APR - s. 34.2(1)
6. Disclosure of cash price - s. 34.2(2)
7. Disclosure of cost of credit - s. 34.2(3)
8. Disclosure for representative transaction - s. 34.2(4)
9. Disclosure - Advertisement for open credit - s. 35.1
10. Lease Advertising - s. 38(1)
11. Representative transaction - s. 38(2)
12. Advertising in prescribed medium - s. 38(3)
13. Records to be kept for three months - s. 38(4)
14. Director entitled to a copy of record - s. 38(5)
15. Prohibition against unauthorized fees (government cheque cashing) - s. 166
16. Expiry dates on prepaid purchase cards/gift cards - s. 171(1)
17. Information that must be provided on prepaid purchase cards/gift cards - s.172.
18. Limit on fees for prepaid purchase cards/gift cards - s. 2 of The Prepaid Purchase Card Regulation (Reg 98/2007).
19. Documents to be given at time of advance - s. 148
20. Payday lender to give receipt - s. 149(6)
21. No fee on cancellation - s. 149(8)
22. Refund to borrower on cancellation of loan - s. 149(9)
23. No security taken - s. 150
24. Requesting or requiring wage assignments prohibited - s. 151(2)
25. Records to be kept - s. 157
26. Records to be made available for inspection - s. 158
27. Assistance to officer or authorized person - s. 159(4)

The amount of the administrative penalty established by regulation is as follows:

	First contravention:	$1,000
	Second contravention:	$3,000
	Third and subsequent contravention:	$5,000

Factors such as the following will be considered in determining whether to issue an administrative penalty notice:

• The seriousness of the contravention.
• Previous enforcement/compliance actions under The Consumer Protection Act for contraventions of a similar nature.
• Whether the contravention was repeated.
• The length of time during which the contravention continued.
• The person's effort to correct the contravention.
• The economic benefit derived by the person from the contravention.
• Any other factors considered relevant.

The Consumer Protection Act also includes offences and penalties that may be imposed where a person has been found guilty of failing to comply with the Act. These penalties remain as an optional alternative to administrative penalties. For example, where the non-compliance involves chronic offenders and/or where the situation has very serious implications for consumer protection, the decision may be to proceed with a prosecution rather than an administrative penalty. A person may not be charged with an offence respecting a failure to comply with the Act or regulations if he or she has paid an administrative penalty respecting that failure. But, the person may be charged with an offence respecting the failure if it continues after the administrative penalty is paid. Additionally, in the case of administrative penalties issued to licencees, the licence may also be subject to conditions, suspension, cancellation, or non-renewal as provided in the Act and the regulations under the Act.

Procedural Summary - Administrative Penalties

Notice of Administrative Penalty:

1. If a Consumer Services Officer finds evidence that a business has failed to comply with one or more of the provisions in The Consumer Protection Act subject to an administrative penalty, the Officer will advise their manager of the situation.
   
   
2. The manager will review the facts in the case and will make a determination as to the appropriate next steps. This may include the issuance of an administrative penalty.
   
   
3. If the decision is to issue an administrative penalty, the Officer or Manager will serve the person in non-compliance with notice of the penalty. Service may be personal (i.e. in person) or by a delivery service that provides the sender with acknowledgment of receipt (e.g. courier, registered mail, etc.).
   
   
4. The notice of administrative penalty must set out:
   1. The provision of the Act or the regulations that the person failed to comply with.
   2. The amount of the penalty, determined in accordance with the regulations.
   3. When and how the penalty must be paid.
   4. A statement of the bases upon which the person may appeal the matter to the director within 14 days after being served.

Appeal of an Administrative Penalty:

5. The person required to pay an administrative penalty can appeal the matter to the director of The Consumers’ Bureau.  They must do so within 14 days after being served with notice of the administrative penalty.  Their appeal must indicate at least one of the following bases of appeal:
   
   
   1. The finding of non-compliance with the Act or regulations was incorrect
   2. The amount of the penalty was not determined in accordance with the regulations
   3. The amount of the penalty is not justified in the public interest.
      
      
6. Where an appeal is made within 14 days, the director will set a date, time, and place for hearing the appeal.  The person appealing will receive written notice of the hearing at least five days before the hearing date.
   
   
7. After the hearing appeal, the director must issue a decision that confirms or revokes the administrative penalty, or varies the amount of the penalty.
   
   
8. The person required to pay the administrative penalty can appeal the director's decision. They must file a notice of appeal with the Court of Queen's Bench within 30 days after the date of the director's decision and they must provide the director with a copy of their notice of appeal to the court.
   
   
9. The Court will consider the factors indicated in point 5 and may confirm the director’s decision, quash it or vary it in any manner that it considers appropriate.

Appeal of an Administrative Penalty:

10. If the penalty is not appealed, it must be paid within 30 days after notice is served. 
    
    
11. If the penalty is appealed, payment must be made within 30 days of the decision of the director, or if appealed to Court, within 30 days of the decision of the Court. 
    
    
12. Cheques are to be made payable to the Minister of Finance for Manitoba.
    
    
13. Failure to pay all or part of a penalty within the required timeframe will result in the registration, in Court, of the outstanding debt.  Once registered, it can be enforced as if it were a judgment of the court.
    

Publication:

14. Details of the administrative penalty issued may be published on the Consumers' Bureau website and may be published in other reports. Details may include personal information such as the name and address of a person or business required to pay the administrative penalty, the name of the owner(s) and director(s) of the business, and the amount of the penalty including whether the penalty was for a first, second, or subsequent offence.
    
    

The following is a link to the list of administrative penalties issued:

http://www.gov.mb.ca/finance/cca/consumb/pen_tab.html