On May 27, 2014, the Competition Bureau (the "Bureau")
announced that an individual had been sentenced to 18 months in
prison for his involvement in a deceptive telemarketing scheme that
targeted businesses and not-for-profit organizations in both Canada
and the United States.
The individual, the former co-owner of Corporation Oxford-Data
Inc. and Sapphire Media Group, plead guilty to eight charges of
misleading advertising and deceptive telemarketing under the
Competition Act and one charge of possession of property obtained
by crime under the Criminal Code. The same individual had
previously been subject of a Bureau investigation in 2012 which led
to charges being laid against him at that time.
The scheme consisted of telemarketing to businesses and
not-for-profit organizations in Canada and the United States,
seeking to renew business directory listings despite the fact that
the organizations contacted had not previously placed a directory
listing with the company. By falsely implying a pre-existing
business relationship, the telemarketers deceived the organizations
into paying for listings they had not ordered. Deceptive
telemarketing charges have been brought against several companies
and individuals for similar types of directory listing/renewal
Deceptive telemarketing is prohibited under the criminal
provision of the Competition Act. Specifically, it prohibits the
making of materially false or misleading representations in
promoting the supply of a product or a business interest during
person-to-person telephone calls. Penalties include significant
fines and imprisonment for up to 14 years.
This is the latest example of the Bureau's continued
enforcement action in the area of deceptive telemarketing in recent
years through its partnership with the Centre of Operations Linked
to Telemarketing Fraud ("COLT"). COLT is comprised of
Canadian and American enforcement agencies, including the Royal
Mounted Police, the Canada Border Services Agency, the Department
of Homeland Security, the U.S. Postal Inspection Service, the U.S.
Federal Trade Commission and the U.S. Secret Service.
For a copy of the Bureau press release, please click here.
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The Canadian Competition Bureau issued a template document for use as a form of Consent Agreement, to be filed with the Competition Tribunal to resolve concerns the Bureau may have with proposed mergers.
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