Upvote:5
Are there any penalties for this situation?
YES
Immigration and Refugee Protection Act (S.C. 2001, c. 27)
Sanctions for Unlawful Entry and Overstaying
The IRPA does not specifically criminalize unlawfully entering the country or unlawfully overstaying a visa. Both of these types of actions, however, fall under the general prohibition against contravening the law without exercising due diligence to prevent doing so.
Crown prosecutors have discretion to try general IRPA offenses either by way of an indictment or in summary proceedings. The distinction between indictable and summary offenses is similar to the distinction between felonies and misdemeanors in the United States, and a crime that can be tried either by way of an indictment or in summary proceedings is considered to be a “hybrid” offense.
The maximum penalty for a person who commits such a general offense as entering the country unlawfully or unlawfully overstaying a visa is a fine of $50,000 and imprisonment for two years, if prosecuted by way of an indictment, or a fine of $10,000 and imprisonment for six months, if prosecuted in summary proceedings. Crown prosecutors usually base their decisions as to whether a defendant should be tried by way of an indictment or in summary proceedings upon such factors as the seriousness of the violation, the defendant’s intentions, and the defendant’s prior record.
Most persons caught violating the general provisions of the immigration laws are deported or ordered to leave Canada. CBSA administers the detention and removal of illegal immigrants and persons who overstay their visa.
I personally would not disclose a past transgression which is beyond the statute of limitations. Neither would I volunteer if I previously innocently provided inaccurate information that has never been discovered.
In his case he very likely was never asked anything like that so he didn't lie to immigration. There are likely thousands of Americans who cross the border into Canada a month who have the ghosts of DUI's present or past.
What if, hypothetically, they were to try to apply for residency/citizenship at a later date, would this be grounds for automatic denial?
That's long term travel/migration and is beyond the scope of this site. You can ask under Expatriates.