Easy Cash Financial Inc. v. Registrar, Payday Loans Act, 2008, 2024 CanLII 97858

Licence Appeal Tribunal File Number: 16017/PLA

In the matter of an appeal from a Notice of Proposal to refuse to renew a payday lender licence under the Payday Loans Act, 2008, S.O. 2008, c.9

Between:

Easy Cash Financial Inc. Appellant

and

Registrar, Payday Loans Act, 2008 Respondent

DECISION AND ORDER

Vice-Chair: Jeffery Campbell

Appearances:

For the Appellant: Arbab Ul-Hassan, Representative For the Respondent: Shane Gallagher, Registrar Steven Succi, Counsel

Heard by videoconference: October 7, 2024

OVERVIEW

1The appellant, Easy Cash Financial Inc. (the “appellant”), appeals the Notice of Proposal, dated May 23, 2024 (the “NOP”), issued by the Registrar, Payday Loans Act, 2008 (the “respondent”), pursuant to sections 10 and 13 of the Payday Loans Act, 2008, S.O. 2008, c. 9, and the Regulations (the “Act”) to refuse to renew the appellant’s Payday Lender Licence (the “licence”).

2The NOP is based upon the grounds that the appellant is not governable and has demonstrated a willingness to knowingly contravene the Act by repeatedly ignoring requests for information. Further, the appellant does not have the required bank account, and has failed to provide information regarding a new bank account to confirm compliance with s. 11 of O. Reg. 98/09.

3Arbab Ul-Hassan is the sole shareholder, officer and director of the appellant.

Issues in Dispute

4The issues in dispute are;

1. Has the respondent established that the appellant has failed to provide information to the Registrar pursuant to subsection 13(4) of O. Reg. 98/09 under the Act?

2. Has the respondent established that the appellant has failed to maintain a bank account as required by subsection 11(1) of O. Reg. 98/09 under the Act?

3. If either of the above is true, what is the appropriate sanction?

Evidence and Analysis

5At the beginning of the hearing, the appellant admitted to the facts with respect to Issues 1 & 2 and submitted that the issues are no longer in dispute. As such, I find that the respondent has established on a balance of probabilities that the appellant has failed to provide information to the Registrar pursuant to subsection 13(4) of O. Reg. 98/09 under the Act and has failed to maintain a bank account as required by subsection 11 (1) of O. Reg 98/09 under the Act.

What is the appropriate sanction?

6Section 13(7) of the Act states that after holding a hearing, the Tribunal may,

(a) by order, direct the Registrar to carry out the Registrar’s proposal or substitute its opinion for that of the Registrar; and

(b) may attach conditions to its order or to a licence.

7With respect to the appropriate order, I am mindful of the Tribunal’s obligation to consider the possibility of a lesser order than that of a refusal of the applicant’s registration as a supplier (see Joshi v. Superintendent, 2016 ONSC 4477 paragraphs 13 & 14).

8The respondent submits that the Act is consumer protection legislation aimed at ensuring the financial safety of vulnerable consumers. Subsequently, it is necessary for payday loan providers to strictly adhere to the Act, its Regulations and the rules of the Registrar.

9The respondent submits that the appellant failed to communicate with the Registrar on numerous occasions ignoring their requests for necessary information, including bank account documentation. This documentation was never received, except for a TD Trust Account Information Sheet received on September 6, 2024, which provides no specific information. The respondent also submits that the appellant failed to notify the Registrar upon the closing of their previous bank account with the Bank of Montreal until long after the required 5-day notification period.

10The respondent submits that, due to the continued non-responses of the appellant and its history of disregarding the Registrar’s requests, this is not a situation where the imposing of a suspension or conditions would adequately ensure the consumer protection purposes of the Act. The respondent submits that the refusal to renew the appellant’s licence is the only appropriate sanction.

11The appellant submits that it was not aware of the requirement to inform the Registrar of the changes in its bank account. It also agrees that it was non-responsive to the Registrar’s requests for information. It submits that, going forward, it will employ a third-party individual to ensure the appellant’s adherence to the requirements of the Registrar and the Act.

Conclusion

12I agree with the respondent that conditions are not appropriate in this matter. Both parties agree that the appellant was non-responsive to the Registrar’s requests. Further, since those requests dating back to 2023, the only documentation forwarded to the Registrar by the appellant was the TD Trust Account Information Sheet, which is merely a face sheet of the account, providing no other vital banking documentation. This, in my view, fails to reach even a minimal level of disclosure necessary for the Registrant to properly perform its duties under the Act to protect vulnerable consumers.

13Based on the above, I conclude that conditions are not appropriate in this case. Pursuant to s. 13(7) of the Act the respondent is directed to carry out its Notice of Proposal to refuse to renew the licence of the appellant.

ORDER

14The respondent is directed to carry out its Notice of Proposal to refuse to renew the appellant’s licence.