Consumers Council of Canada calls upon the Government of Canada to better protect banking consumers in Canada both before and after ‘the sale’ with stronger regulatory oversight and enforcement and by ending banks’ ability to choose their own dispute resolver.
The just-announced decision by Scotiabank to withdraw from the Ombudsman for Banking Services and Investments, joining other banks in adopting a for-profit arbitration service of their own choice, is the latest example of the low regard and indifference in which Canadian consumers are held by both the big banks and public policy makers that enable this conduct.
"Banking consumers deserve a single, transparent, accountable and accessible ombudservice to resolve disputes with their banks," said Don Mercer, Consumers Council of Canada President.
Created in 1996 to act as an impartial and fair investigator of banking and investments related complaints, OBSI performed this duty until 2008, when the previous federal government decided to allow banks to choose between OBSI and ADRBO, a for-profit dispute resolution organization.
"An ill-conceived policy is eroding the modest existing accountability to consumers for how well dispute resolution in banking functions in the country," said Mercer. "Given the recent revelations about banking sector sales practices, this state of affairs has become increasingly outrageous."
Today, by comparison, OBSI is still the single, required Canadian ombudservice for all investment services involved in the sale of securities.
"The Consumers Council of Canada calls upon the Government of Canada to restore OBSI as the exclusive dispute resolver for banking sources, with reformed and stronger authority to provide fair and accessible redress to bank customers," said Mercer.