Ottawa’s review into business practices at Canadian banks not enough for NDP
One review of the business practices at Canada’s five biggest banks is being launched, but another may be on the way.
An independent government agency will begin taking a closer look at the banks business practices next month, following reports that customers have been pressured and even tricked into buying products and services.
However, the NDP is leading a call for a parliamentary inquiry.
The Financial Consumer Agency of Canada, which enforces consumer protection legislation, committed on Wednesday to reviewing the business practices at RBC, BMO, CIBC, TD and Scotiabank starting in April.
FCAC commissioner Lucie Tedesco issued a statement on Wednesday, expressing concern with recent allegations related to the sale of products and services by financial institutions to consumers without properly obtaining their consent.
“The law requires that, in order to provide consumers with new or expanded products or increase their credit limits, financial institutions obtain their customers’ prior consent and disclose key information about the costs and charges of the products they are purchasing,” Tedesco said.
“Through the industry review we are announcing today, we will examine financial institutions’ business practices in relation to express consent and disclosure, including the identification of any factors that may be contributing to non-compliance.”
The CBC began airing reports last week quoting unnamed TD employees, who claimed they were pressured to up-sell, trick and even lie to customers in order to meet unrealistic sales targets or risk losing their job.
Workers from the other four banks have since come forward with similar allegations, which include upgrading credit cards and credit limits, and lying to clients about interest rates.
Not satisfied with the FCAC review, the NDP’s finance critic Alexandre Boulerice is among those calling for a parliamentary inquiry.
The Canadian Bankers Association indicated in a statement that its member banks will co-operate “fully and constructively” with the review.
It insisted they’re acting in the best interests of their customers, but the statement did not address employees’ concerns about high-pressure sales tactics.
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