In 2020, the Financial Consumer Services Commission (FCNB) saw an increase in complaints from New Brunswickers about unlicensed online payday lenders.
Part of FCNB’s mandate is to protect New Brunswick consumers through education. Being well-informed is the best way for New Brunswickers to gain the knowledge, skills and confidence to avoid some of the common pitfalls of consumers purchases.
Recently, FCNB ranked the top consumer complaints and inquiries received last year – among them, unlicensed online payday lenders, product warranties and high-pressure door-to-door sales.
“Many of the consumer complaints we receive are the result of New Brunswickers not understanding their rights and responsibilities when it comes to making a consumer purchase,” says Alaina Nicholson, director of the Consumer Affairs Division. “We hope sharing these common consumer lessons with the public will benefit New Brunswickers so they can be better informed consumers going forward in 2021.”
FCNB investigates consumer queries relating to a wide range of financial and consumer protection legislation in the province, provides information to help a consumer address or resolve their complaint, and educates consumers and businesses on their rights and responsibilities. Not all inquiries or complaints FCNB receives fall under legislation it administers and if possible, when a query is outside of FCNB’s scope of regulation, staff may refer the question or complaint to the appropriate agency.
“One thing all consumers can do to protect themselves is to ask questions before buying,” says Nicholson. “Ask about the policies and terms of sale and do a little research on the person you are doing business with. Visit our website to verify licensing and registration, learn about the Acts, rules and regulations FCNB administers, and understand your consumers rights and responsibilities.”
In 2020, the top consumer inquiries and complaints in New Brunswick were in the following categories:
Warranties
Many New Brunswickers may not be aware they have rights under the Consumer Product Warranty and Liability Act when a product they bought doesn’t work, is defective or does not live up to their expectations or the seller’s promises. This legislation applies to new and used goods sold by a dealer for personal, family or household use, but does not apply to private sales between individuals. Learn more here about what to do when a product does not meet reasonable expectations.
Return and refund policies
A common myth is that New Brunswick consumers have the right to return a product if they simply change their mind or are unhappy with their purchase within 30 days. In New Brunswick, sellers are not required by law to offer refunds, returns, or exchanges if a consumer changes their mind. Sellers have the right to set their own return and exchange policies, decide how much time a consumer has to return a product, and whether the consumer’s refund will be given in cash or a store credit. Learn more about returns and refunds.
Online payday loans
In 2020, FCNB saw an increase in complaints about unlicensed payday lenders. These complaints highlight inappropriate behaviour from unlicensed payday lending businesses, including reports of intimidating collection practices and aggressive communication methods. Using the services of an unlicensed lender puts the consumer at a greater risk of harm. Using licensed lenders provides New Brunswickers with some added legal protections from predatory lending practices, such as interest rate caps, disclosure requirements and cancellation options. New Brunswickers can verify that a payday lender is licensed by visiting FCNB’s website.
Collection agencies
Despite best efforts, sometimes people fall behind on payments to creditors. When this happens, a creditor has the right to collect on a debt that is owed to them, and the consumer has the right to be treated reasonably and with respect. In New Brunswick, collection agencies and the individuals who work as collectors must be licensed with FCNB and must follow the rules as outlined in New Brunswick’s Collection and Debt Settlement Services Act. Learn more about prohibited collection practices.
High pressure door-to-door sales
New Brunswick’s Direct Sellers Act regulates sales made through door-to-door sales, home-party sales, and in-home sales arranged through a telemarketing call. Many consumers are surprised to learn this Act provides for a 10-day “cooling-off” period for goods or services purchased via a direct sale. New Brunswickers should be aware of their rights and responsibilities and recognize high-pressure sales tactics when dealing with a door-to-door salesperson. Learn more about buying from direct sellers.
Managing credit
Credit is an agreement a person makes with a lender that allows them to buy goods or services now and pay for them later. In return, the person agrees to pay the lender back, usually with interest, in the future. Common types of credit include credit cards, mortgages, personal loans, lines of credit, payday loans and leases. When money is borrowed from a lender, the lender expects the borrower to live up to the terms of the agreement and pay as agreed. It’s important to understand the terms of a credit agreement before you sign. Learn more about managing your credit.
Fraudulent phone calls, emails and letters (phishing)
The COVID-19 pandemic provided many scammers with a window of opportunity, and FCNB saw an increase in reports of fraud and scams. Scammers use various methods to reach their victims -- online, via text, over the phone, even at their doorstep. They are always inventing creative new ways to try to convince New Brunswickers to part with their private information and hard-earned money. While fraudsters and scammers are quick to adapt their methods to take advantage of a crisis, FCNB reminds New Brunswickers that carefulness is key. Learn more about the red flags of fraud.
The Financial and Consumer Services Commission has the mandate to protect consumers and enhance public confidence in the financial and consumer marketplace through the provision of regulatory and educational services. It is responsible for the administration and enforcement of provincial legislation regulating mortgage brokers, payday lenders, real estate, securities, insurance, pensions, credit unions, trust and loan companies, co-operatives, and a wide range of other consumer legislation. It is an independent Crown corporation funded by the regulatory fees and assessments paid by the regulated sectors. Educational tools and resources are available online.