Finance Minister Jim Flaherty, in Ottawa, June 21, 2012. THE CANADIAN PRESS/Sean Kilpatrick
July 06, 2012 - 12:08 PM
OTTAWA - Ottawa says it will impose new standards for settling consumer complaints against Canada's big banks.
Finance Minister Jim Flaherty says the two dispute-settling bodies that handle complaints will be required to make their decisions sooner and meet new standards of independence and transparency.
As well, the bodies will come under the supervision of the Financial Consumer Agency of Canada.
But nothing in the rules will make decisions by the complaint review services binding on the banks, and they will still have a choice of who will hear the cases.
Recently, the Royal Bank (TSX:RY) and TD Bank (TSX:TD) pulled out of membership with the Ombudsman for Banking Services and Investments (OBSI) and hired ADR Chambers to act as their dispute settlement service.
That has led to differences in procedures and uncertainty for consumers, the government says.
The new rules — once in place after a 30-day consultation period — would require dispute settling agencies be federally approved and meet new standards for speed, transparency and independence.
Among the changes, judgments must be reached within 120 days of receiving a complaint, down from the industry standard of 180 days.
As well, those involved in the resolution of complaints by the body must be independent and banks will be required to inform consumers of the name and contact information of the external complaints body.
Flaherty says in a statement the new rules will give more power to consumers and will create a stronger, independent complaint system.
News from © The Canadian Press, 2012