Canadian Tire Faces $1.3 Million Fine for False Advertising
Canadian Tire has been ordered to pay nearly $1.3 million following a guilty plea related to false advertising practices. The retailer pleaded guilty to violating the Consumer Protection Act on 74 counts, revealing serious issues within their pricing strategies.
Plea Agreement Details
The Crown prosecutor, Jérôme Dussault, noted that Canadian Tire initially pleaded not guilty, which later led to a negotiated settlement. Judge Simon Lavoie of the Court of Quebec approved the settlement at a Montreal courthouse, stipulating penalties between $15,625 and $18,150 for each charge, culminating in a total of $1,287,550.
Investigation Overview
The investigation, initiated by the Office of Consumer Protection (OPC) in 2021, uncovered misleading pricing tactics. Spokesperson Charles Tanguay explained that the flyers, website, and in-store price displays featured inflated reference prices. This practice created an illusion of larger discounts than were actually provided.
- Targeted products were rarely sold at the advertised “regular price.”
- In-store observations indicated that these so-called regular prices were seldom displayed.
Products Under Scrutiny
The OPC focused on seven specific products, checking their prices from April to October 2021. Among these, Canadian Tire admitted guilt for five items:
- Henckels knife sets
- Cuisinart knife sets
- Lagostina cookware sets
- Heritage cookware sets
- Dewalt cordless drill
As part of the settlement, Canadian Tire is required to pay the imposed fines within 12 months.
Legal Implications
This case highlights the importance of adherence to the Consumer Protection Act, particularly section 225(b), which prohibits merchants from falsely representing regular prices for goods. The outcome serves as a reminder to other retailers about the legal ramifications of misleading advertising practices.
