OMVIC Practice Test

When dealing with consignment sales in the context of auto dealerships, it's important to understand the role of trust accounts. A trust account is a financial account used to hold money on behalf of others, which must be kept separate from the dealer's own funds.

In Ontario, as regulated by OMVIC (Ontario Motor Vehicle Industry Council), any money received from a consignment sale that exceeds $10,000 must indeed be deposited into a trust account. This requirement is in place to protect consumers and ensure transparency and proper management of funds. It helps to prevent misappropriation of funds, allowing the dealer to manage the consigned vehicle sales ethically and responsibly.

Establishing a trust account for such significant transactions also promotes trust between the dealership, consignees, and customers, ensuring that all financial dealings are handled appropriately and that the dealer complies with regulatory standards. This practice is part of maintaining good business ethics and compliance with the law in the automotive sales industry.