1) Can an advisor/professional disciplined under your rules continue to stay in business advising others/ what are the repercussions?
2) Does your organization get people’s money back?
3) Can people check a public website to see if your member was disciplined?
The Ombudsman for Banking Services and Investments (OBSI) said that although they do not have the power to take disciplinary action or to enforce compensation settlements, they have great persuasive power and that over 99% of the complaints they receive have been successfully resolved.
Their power is derived from what is commonly known as the “name and shame” provision of their mandate. They can recommend an institution compensate a client for up to $350, 000. If a financial services firm doesn’t follow one of their recommendations, OBSI must announce and publicize the refusal. These announcements are searchable via their website.
It should be noted that that clients looking to have access to OBSI dispute resolution should ensure that their firm, bank, credit union, investment dealer, mutual fund dealer/manager, investment counsel and or portfolio manager is a participating partner. Recently TD and Royal Bank have pulled their funding and participation from OBSI. To read OBSI’s full letter, please see below.
The Investment Industry Regulatory Organization of Canada (IIROC) can take disciplinary action against its members. They require all IIROC- regulated firms to participate in the Ombudsman for Banking Services and Investments as well as an independent arbitration program. Investors can also search their database of disciplinary cases dating back to March 2003 relating to IIROC-regulated firms and their employees across the country. To read IIROC’s full letter, please click here.
Advocis (The Financial Advisors Association of Canada) does not have the authority to strip an advisor of their licence to practice and sell product; this is the responsibility of industry and provincial regulators. The Institute does not seek monetary compensation on behalf of consumers for any financial loss suffered over the course of a client-advisor relationship with an Advocis member. They do, however, require that members be bound by a professional code of conduct that requires them to always act in their clients’ best interest as well as to hold professional liability insurance. To read the Advocis letter, click here.
The Ombudsman for Banking Services and Investments (OBSI): Anatomy of a Complaint Letter
The Ombudsman for Banking Services and Investments (OBSI) is Canada’s independent ombudsman for consumers and small businesses with a complaint they can’t resolve with their banking services or investment firm.
We are an independent not-for-profit organization operating in the public interest. Our services are free, and we can recommend compensation up to $350,000. For most financial complaints we are the only option outside of the courts for people to get their money back. We are fully functional in both English and French, and are able to handle inquiries in over 170 languages.
HOW WE WORK
Our staff – with a wide variety of experience and training in financial services, law, accounting, dispute resolution and regulatory compliance – review and investigate unresolved complaints from clients about banking and investment products and services.
If we find the firm has caused a loss, we will recommend a settlement that aims to make the client whole. We may also recommend compensation for inconvenience in the appropriate circumstance, or non-financial actions such as correcting a credit bureau record. If we find the firm has acted appropriately, we will explain to the client why we came to that conclusion.
When we receive a complaint, our assessment team looks at the file to make sure it falls within our mandate. For instance, the firm has to be one of our participating banks, credit unions, investment dealers, mutual fund dealers and managers, investment counsel/portfolio managers and scholarship plan dealers. We also look for a final answer from the firm to the client, which allows us to start our review knowing the positions of both firm and client. OBSI will look at complaints where the client is either unsatisfied with their firm’s final response, or at least 90 days have passed since the client first complained to their firm and the complaint remains unresolved.
During an investigation, we gather information from the parties and review the facts of the case. We make decisions based on what’s fair to both the client and the firm, taking into account general principles of good financial services and business practices, the law, regulatory policies and guidance, and any applicable professional body standards, codes of practice, or codes of conduct.
If we believe that the facts of the case do not warrant further review, we will let the client know quickly. We always make sure that we explain our reasons, just as we do when we are recommending compensation.
If we believe compensation is owed to the client, we try to settle the dispute through a facilitated settlement between the client and firm that aims to address the complaint quickly with a fair outcome to both parties. If that doesn’t work, we make a formal recommendation of compensation.
While our decisions aren’t binding, over 99.8% of the thousands of complaints brought to OBSI since the organization’s inception have been successfully resolved. You might wonder how that could be, given we can’t force firms to follow our recommendations. Our power is in what is commonly known as the “name and shame” provisions of our mandate. If a financial services firm doesn’t follow one of our recommendations, OBSI must announce and publicize that refusal to compensate. Since firms are concerned about their reputation among customers and in the marketplace, very few want to be named and shamed. These announcements live on on our website where there are accessible by members of the public researching which investment firm they should give their money to.
To understand more about how OBSI’s works, give us a call or visit our website. We’d be happy to help.