Another broker scam, or am I being paranoid?

[kokajambo]

I found a boat I like.

It was built in Canada, finished by the owner, and is registered there with the Canadian Register of Vessels.
Owner is a great guy, but he's selling it thru the shady broker, whom I get to deal with.

So, the agreed price is $22.5K. I want to register it in Washington state. No USCG documentation for now.

Broker has suggested using services of his trusted "Shady Documentation Inc", who sent me a statement settlement that includes:
- 8.7% sales tax,
- $150 Registration fee,
- $250 Canadian Deletion fee,
- $350 Closing fee.

I was not exactly expecting to pay this amount, so started asking questions. Both broker and closing agent claim that it is necessary to remove the boat from Canadian Registry first, to be able to register it with the state (hence 250 extra).
Also, presumably, in order to document it with the USCG, I'd need the proof of the deletion, too.

I was able to find an option to get "Deletion certificate" on Canadian Marine Transportation website (https://www.tc.gc.ca/eng/marinesafet...menu-4427.html) for $50.

However, neither DMV, nor USCG websites mention it as a requirement for registration or documentation. I even called that DMV office that's closest to the Shady Docs Inc address, and asked them if they require any proof of deletion. They said no, only copy of current Canadian registration, and a notarized Bill Of Sale with matching names.
USCG explicitly states that either notarized Bill of Sale or State Title are valid proofs of ownership.

Shared the above with the suspects:
- closing agent got upset and told me DMV knows nothing and I should trust him if I want it to be done the right way.
- selling broker proceeded with telling me that I'm already lucky that I've saved $891 on Import fee that seller has already paid. And that he's going out of town starting tomorrow and he'd like to get that paperwork done.

I also got upset and keep fact-checking on, and it appears that since the boat was built in Canada, it should be subject to NAFTA, and can be imported into US for personal use without having to pay Import Duty.

So far it adds up to $1641 in arbitrary fees between me and the seller, presumably on top of their 10% commission.
I haven't heard sellers side of story yet, I wouldn't be surprised if there are more fees there.

Plus, thousands of dollars for therapy and rehab from the PTSD I'm going to develop in the course of this "adventure".

If somebody cares or is curious, and has relevant knowledge or experience, would you double-check my findings please?

I need to know if I'm being paranoid or not.

[Calif.Ted]

You will be liable for the Washington state sales or use tax but otherwise I believe you are right to think you can do without their "expert services".

[StuM]

You only need to de-register in one country if you want to "nationally register" (US Document) in another country. State registration is a totally different issue and whether or not the boat is nationally registered (and if so, in what country) is immaterial.


That said, I have no idea about US Import Duty/ State sales taxes.

[Freedom45]

You must deregister Canadian and send proof in with paper work for USCG documentation. You can do it yourself.
Been there, done that.

[Chotu]

You don’t need the services of that company. You can do this yourself. You have already found out how. So why proceed with them? Just buy the boat and deregister it. Then proceed in the United States as normal.

[Jim Cate]

Dunno about Canada, but when we, as US citizens, bought an Aussie registered vessel, it had to be deregistered before I could buy it. Non-citizens are not allowed to own registered ships in many countries.

Jim

[john61ct]

I can understand the PO not wanting to allow a redundant registration in their name, of a boat they no longer own, to remain.

[kokajambo]

Thanks for all of the reassurances!

I've looked up a couple of more things, and indeed when applying for national registration of the boat in Canada and Australia, they want proof of deletion form previous registration. I haven't gotten official answer from USCG on it yet though, working on it. That'd still explain only $50 in extra fees.

Another update:
I've got the seller involved, and am now thinking that they are the ones who might suffer real loss in this situation:
- Their broker/agent owes them a fiduciary duty, and is supposed to act in seller's best interest.
- Now, if they drive the buyer away by insisting that we use their buddy's Shady Closing Company (who in turn attempts to charge me extra $750 in fees that were not part of the original purchase agreement), the agent might be in a breach of contract with the seller, because it's their sale that falls thru.
- Furthermore, if the agent is materially interested in using that specific closing company (eg gets a share of their fees), it might constitute a bribe.

[Sand crab]

The import fee is irrelevant because Canadian built boats are still duty free under the (new) NAFTA. The broker mentioning how much you have already saved shows his inexperience in this process.

[dlane1181]

Originally Posted by Chotu

You don’t need the services of that company. You can do this yourself. You have already found out how. So why proceed with them? Just buy the boat and deregister it. Then proceed in the United States as normal.

I have a different opinion from you and seemingly the majority.

First of all your so-called Shady Broker isn’t likely scamming you. Rather s/he is providing a service for a fee, specifically deregistering your new boat in Canada. He is offering to use his time and expertise to accomplish this task for you. You are free to accept or decline his service.

The next issue to consider what is your time and effort worth? Do you want to spend time and energy researching laws and policies online and filing documents online or in person, having documents notarized, etc. Or can you sub this out to a trusted agent, freeing up your time to work on things more directly related to the safe operation of your vessel?

I’ve done it both ways, and I nowadays I usually opt to have an expert do it for me with a guaranteed outcome on the first try. Especially when it’s in the US$200 range.

Good luck whichever way you choose to go. Give feedback on how easy or hard it is if you do it yourself, including how many hours you spent doing it yourself (including the time already invested).

[Ken Pole]

On the

[rosatte]

I just did the opposite bought a boat in WA brought it to canada you do not need their service do it yourself when you register it in WA then it is removed from Canadian register all done through custom s and transport canada all s you pay is tax to WA for importing boat ,,

[YachtBroker]

You can say shady broker but look there are usually fees associated with any boat sale. If someone is going to do it for someone, that Someone has to get paid to do it. Why would you even suggest the broker is shady? Sounds to me He's just trying to help you close the deal.

Those so called fees you listed don't look that expensive to me when USCG documentation usually runs $700-800 per deal and yes you can do it yourself direct with the USCG for $2-300.
So do it yourself and take your chances but I have had canadian registries that took months to get right and a bonded documentation agent took care of it for clients of mine from start to finish for a few hundred dollars. Maybe not to you but to me, Well worth it.

[Lake-Effect]

Is the broker Canadian, US, or operates in both countries? Is the owner Canadian or American? Where would the actual transaction take place?

In our area there are one or two brokers that have offices in, and listings from both countries. I have often wondered how that might work, and if they actually facilitate (for a fee) the customs, transfer and paperwork, including moving the boat into the buyer's jurisdiction. Is the Shady(?) Broker doing something like this?

[Comix Bay]

Long story about an import into CA.

Coming north from WA to BC my son and I brought a boat he purchased in WA on a trl through US border and Canadian Customs. US border just waved us through, drove up to Canadian Customs son went in said I just bought this boat and trl what do you need. Answer “bill of sale with price for boat and price for trl”. He then paid CA GST on boat. Trl had WA plates on, no problem, transfer ownership when you get to your home!! Canadian Customs guy said as we were driving through gate “by the way, that plate is expired”. He had to have trl inspected as it is classified as a MV in BC, then paid the PST on import of trl.

We got the boat home, applied for CA registration number on line, he drove boat with WA numbers till his CA papers came in the mail a couple weeks later!! No problems at all. He still has trl plate hanging on his garage wall.