Chapter 9: The Impact of Legislation and Regulations

Question 1

What is a Bait and Switch?

Answer 1

A bait and switch is an advertisement that misrepresents the consumer’s opportunity to purchase goods and services at the terms presented.

Question 2

What does the Canadian Code of Advertising Standards promote?

Answer 2

The Code promotes truth, honesty, fairness, and accuracy in advertising and is comprised of fourteen clauses that set the criteria for acceptable advertising.

Question 3

What does the Mortgage Brokerages, Lenders and Administrators Act, 2006 prohibit regarding advertising?

Answer 3

Section 27 states that, “No person or entity shall authorize any advertisement for a mortgage which purports to contain information relating to the cost of borrowing or any other pre-scribed matter unless the advertisement contains such information as may be required by the regulations and is in such form and manner as may be prescribed.”