IRCC proposes creation of compensation fund for victims of unethical immigration consultants

Immigration, Refugees and Citizenship Canada (IRCC) has proposed new regulations that could provide millions of dollars in compensation for victims of dishonest immigration consultants.

This change is part of a number of draft regulations for a number of changes to the governance and operations of the College of Immigration and Citizenship Consultants, published in the Gazette.

The College is the regulatory authority set up by IRCC in 2021 to oversee immigration and citizenship consultants and protect the public.

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Compensation fund

The proposed regulations would establish when clients of immigration consultants are eligible to receive compensation for suffering from a registered consultant's dishonest act.

In an analysis on how the compensation fund might operate, IRCC projects that in period 1, the fund would issue 146 payments, with an average estimated payment of $4,652. In the first 10 periods, the ministry estimates that compensation fund payments would total $5,756,304.

The regulations would also set out when clients would need to apply to receive compensation, and when they could receive compensation without applying.

Under the current regulations, if the College's Discipline Committee were to determine that a client suffered financial loss as a result of a licensee's dishonest act, the client would be informed of their eligibility for compensation from the College, with no application required.

The regulations state that applications for compensation would be required in cases when

• The College's Discipline Committee has determined that the licensee committed a dishonest act, but could not determine the financial loss; or
• The Complaints Committee did not refer the client's complaint to the Discipline Committee, on account of the licensee's license having been revoked.

The proposed regulations would also establish how the compensation fund be managed and financed.

The aim of the new regulations is to encourage paid representatives to act more honestly and to combat fraud. The regulations are expected to come into effect in 2025.

Additional Changes

The regulations also aim to extend the College’s authority when it comes to the following:

• The public register of immigration consultants: This can help the College by instantly verifying whether a consultant is authorized to provide immigration services.
• Complaints and discipline processes: This can streamline processes.
• Investigations: This would grant the College more authority to conduct investigations into consultants suspected of fraud.

Earlier announcements

The draft regulations builds on the penalties for paid immigration representatives who violate the law, which were announced earlier this year by Marc Miller, Minister of Immigration.

In a press conference on Jan 15, 2025, Miller announced IRCC's intention to implement harsher fines along with a naming and shaming campaign.

Huge financial penalties

The proposed penalties include fines of up to $1.5 million for advising clients to misrepresent themselves.

Note: Misrepresentation refers to providing information to the government of Canada that is untrue and could cause an error in applying immigration law to the case.

Misrepresentation can lead to severe consequences for applicants, including rejected applications, fines, being banned to apply for Canadian immigration for five years; and/or being ordered to leave Canada.

Public disclosure of offenders

Information about paid representatives found guilty of violations will be published on the department’s website.

This would include publishing the nature of the violation, the amount of the penalty, and an indication of whether the representative has paid the penalty.

What do immigration consultants and immigration representatives do?

Immigration consultants guide individuals and families on navigating Canada’s immigration system. Citizenship or immigration consultants must be members of the College of Immigration and Citizenship Consultants.

Immigration representatives offer immigration advice and help people choose the best immigration programs for their objectives. They can also act on an applicant's behalf for immigration and citizenship applications, while communicating with the government, or at hearings.

There are two types of representatives: paid and unpaid.

Paid representatives must be authorized by the government. These include

• lawyers and paralegals who are members in good standing of a Canadian provincial or territorial law society;
• notaries who are members in good standing of the Chambre des notaires du Québec; and
• citizenship or immigration consultants who are members in good standing of the College of Immigration and Citizenship Consultants.

Anyone can act as an unpaid representative. However, it must be declared on an application whether there was the use of a representative, paid or unpaid. Failure to disclose this can lead to an application getting rejected.

Note: If you provide any form of compensation to a representative in return for their services, they are considered paid and must be authorized.

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