September 5, 2017

Interesting differences between Ontario and most other provinces.

The latest insolvency statistics have been released by the Office of the Superintendent of Bankruptcy.  Although May 2014 (the last reported month) saw a slight decrease in the number of filings over the same month in the prior year overall the numbers have increased slightly.

However, what is noteworthy is the insolvency mix.  On average across Canada more bankruptcies are filed than consumer proposals.  In fact the ratios are about 60/40 in favour of banruptcy filings – but not so in Ontario.  On average more Ontarians are filing proposals than bankruptcies.  Alberta also saw a slightly larger number of proposals to bankruptcies.

What is driving this difference?  Perhaps it reflects the role of the unregulated debt consultants who push people towards proposals as an alternative to bankruptcy.  Some provinces have regulated the debt consultants virtually out of existence, but Bill 55 in Ontario has yet to be brught into force.

I have blogged about debt consultants on many occassions but people still fall for their promises, so just a recap – there are no new federal government programmes, only a licensed trustee in bankrupcty can file a consumer proposal, debt settlements rarely work and can be unnecessarily expensive, some companies operate form foreign countries (especially the USA) where they cannot be sued after they have taken your money.

“caveat emptor”