Mis-selling

Definition

• The act of misrepresenting a product or service and misleading a perspective client, investor, or buyer in order to make a sale. An unethical salesperson mis-selling a product may leave out certain caveats or information to make a product sound better or more relevant to the buyer than it truthfully is. For example, a computer salesperson may tell a customer to buy a $2,000 computer when a $500 computer will do the exact same tasks at a quarter the cost, or an insurance agent may try to persuade an individual without dependents to buy a life insurance policy they do not need.

Synonyms
misrepresenting, undisclosed information, misleading

Related Terms and Acronyms

• Agent (agt) — Abbreviation,
  • A person who acts on behalf of another. In real estate, an agent is a person who conducts transactions on behalf of sellers and sometimes buyers.
• Clean Sheeting — Definition,
  • A type of insurance fraud where an individual deliberately fails to disclose a pre-existing condition in order to receive coverage, sometimes with the help of an insurance broker.
• Concealment — Definition,
  • The act of lying or omitting information when applying for insurance coverage.
• Disclosure — Definition,
  • A statement listing potential defects to a property, such as the possible existence of lead paint or radon.
  • A statement required by most provinces that requires the creditor to tell the debtor the annual percentage rate, finance charges and other terms of a loan.
• Fiduciary Duty — Definition,
  • A requirement that someone in a position of trust, such as a banker, real-estate agent, or title agent, must act in good faith and trust on behalf of a client.
• Insurance Fraud — Definition,
  • An illegal attempt by an individual or entity to receive insurance benefits that they would otherwise not be entitled to or for an insurance company to deny a legitimate insurance claim.
• Property Report — Definition,
  • A legal disclosure that developers of timeshare properties are required to give to prospective buyers.
  • A legal document prepared by a surveyor that shows the locations of all visible public and private improvements relative to property boundaries.
• Statute of Frauds (SOF) — Acronym,
  • A law which provides that certain contracts must be in writing to be enforceable at law. This includes real estate contracts.
• Unfair Claims Practice — Definition,
  • The act of an insurance company avoiding or reducing valid insurance claims.