CEO Hit With Personal $ 100k CASL Fine

The Canadian Radio-television and Telecommunications Commission (CRTC) has been cracking down on parties that aren’t taking Canada’s Anti-Spam Legislation (CASL) seriously. In fact the CRTC recently sent a message to Canadian businesses that CASL isn’t all bark and no bite. One corporate director in particular is feeling the sharp teeth of this legislation, and that’s Brian Conley – President and Chief Executive Officer (CEO) of nCrowd.

For those of you who may not know, CASL is a fairly new anti-spam law that applies to all “commercial electronic messages” sent by organizations. These CEMs usually take the form of emails or text messages that essentially encourage the recipient to participate in a commercial activity. For CASL to apply, there must be a CEM that is sent to an electronic address. To be in compliance with CASL, you need to make sure you have explicit or implied consent to send CEMs to customers, or have a mechanism for customers to unsubscribe. 

So how did this piece of legislation end up taking a bite out of Mr. Conley? Well, following a series of complaints in the summer of 2015, the CRTC conducted an investigation into the business activities of nCrowd Group and Couch Commerce Group. Companies owned by these two groups engaged in promoting products and services of vendors on various websites by selling electronic vouchers for these merchants. It was determined that in some cases up to 4 emails per day per complainant were being sent by these groups.  The customer email distribution list even reached approximately 2 million email addresses at one point, which had largely been acquired from Couch Commerce. 

All things considered, on April 23, 2019, the CRTC found that contrary to paragraphs 6(1)(a) and 6(2)(c) of CASL, nCrowd sent CEMs or permitted its subsidiaries to send CEMs to electronic addresses, without consent and without providing an ability for customers to unsubscribe.

The CRTC didn’t stop there, the Commission found that Mr. Conley, as President and CEO of nCrowd Group, took no action and turned a blind eye to his companies’ CASL infringing activities and was therefore vicariously liable.  

The price for his involvement (or lack there of)? $100,000. That’s right. The CRTC imposed a penalty of $100,000 on Mr. Conley personally for the actions of his companies.

In some ways Mr. Conley got off easy – CASL allows fines of up to $ 10 million dollars against Officers & Directors.

Need help ensuring your company is complying with CASL? We’re here to help!

Robin K. Mann, JD