Ombudsman for Banking Services and Investments
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The Ombudsman for Banking Services and Investments (OBSI) is a
Canadian Canadians (french: Canadiens) are people identified with the country of Canada. This connection may be residential, legal, historical or cultural. For most Canadians, many (or all) of these connections exist and are collectively the source of ...
organization whose responsibility is to handle the financial disputes of consumers and small businesses that could not be resolved by the customers and the financial firms on their own. The OBSI provides the service on an impartial and independent basis, and free of charge to the consumer as an alternative to the legal system.


How it works

OBSI is Canada's national independent dispute resolution service (
ADR ADR or adr may refer to: Computing * Asynchronous DRAM refresh, an approach for persistent memory found in some Intel Xeon processors * The adr microformat, part of the hCard microformat * Architectural decision record * Action–domain–respond ...
) for consumers or small businesses with a complaint they can't resolve with their financial services firm. As a free alternative to the
legal system The contemporary national legal systems are generally based on one of four basic systems: civil law, common law, statutory law, religious law or combinations of these. However, the legal system of each country is shaped by its unique history an ...
, OBSI works informally and confidentially to find fair outcomes to disputes about banking and investment products and services. If OBSI decides that a firm has acted unfairly, made an error or given a customer bad advice, and the customer lost money as a result, it will recommend that the firm restore your financial position to where it should have been. OBSI may also recommend other types of non-financial compensation when appropriate. If OBSI thinks a customer has been treated fairly, or the settlement offer the customer has previously received from a firm is fair, OBSI will inform the customer and let them know the reasons why it believes so. While OBSI cannot order a firm to follow a recommendation, OBSI has an excellent record of firms – and clients – accepting its recommendations. OBSI will make public the name of any firm that refuses a recommendation. The limit for OBSI's recommendations is $350,000. However, if a customer's claim is for an amount higher than $350,000 the customer can voluntarily reduce it. OBSI is not a regulator, and because OBSI is impartial it does not advocate for consumers or the industry. That also means OBSI doesn't give advice – financial, legal or other. If a customer doesn't like OBSI's findings in a case, the customer is still able to go to a lawyer or seek other ways of resolving the dispute.


History

OBSI was founded in 1996 as the Canadian Banking Ombudsman to review complaints by small business against the chartered banks. In a few short months the mandate was expanded to cover unresolved consumer complaints as well. In 2002, as a result of discussions among government, industry and consumer groups about improving consumer protection in financial services, all members of the
Investment Industry Regulatory Organization of Canada The Investment Industry Regulatory Organization of Canada (IIROC; ''Organisme canadien de réglementation du commerce des valeurs mobilières'' or ''OCRCVM'' in French) is a non-profit, national self-regulatory organization (SRO). Established thro ...
and the Mutual Fund Dealers Association of Canada joined the organization. At the same time OBSI invited credit unions to join and changed its name to "Ombudsman for Banking Services and Investments" (OBSI). In 2013, the
Canadian Securities Administrators The Canadian Securities Administrators (CSA; , ACVM) is an umbrella organization of Canada's provincial and territorial securities regulators whose objective is to improve, coordinate, and harmonize regulation of the Canadian capital markets. ...
br>announced
amendments to National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) and Companion Policy 31-103CP Registration Requirements, Exemptions and Ongoing Registrant Obligations that will require all registered dealers and advisers outside of Quebec to use OBSI as their provider of dispute-resolution services. By August 1, 2014, all registered dealers must be members in OBSI, with the effect that OBSI's membership will more than double, to over 1600 participating firms. Any regulated firm in the banking services and investment fields is eligible to join OBSI. In September 2018,
Scotiabank The Bank of Nova Scotia (french: link=no, Banque de Nouvelle-Écosse), operating as Scotiabank (french: link=no, Banque Scotia), is a Canadian multinational banking and financial services company headquartered in Toronto, Ontario. One of Canada ...
stopped using OBSI, making the third big bank, after
Toronto-Dominion Bank Toronto-Dominion Bank (french: links=no, Banque Toronto-Dominion), doing business as TD Bank Group (french: links=no, Groupe Banque TD), is a Canadian Multinational corporation, multinational banking and financial services corporation headquarte ...
and the
Royal Bank of Canada Royal Bank of Canada (RBC; french: Banque royale du Canada) is a Canadian multinational financial services company and the largest bank in Canada by market capitalization. The bank serves over 17 million clients and has more than 89,000& ...
to not use OBSI.


Complaints that OBSI deals with

OBSI looks into complaints about most banking and investment matters including:
* mutual funds * bonds and GICs * stocks, exchange-traded funds, income trusts and other securities * investment advice * unauthorized trading * fraud * mortgages * loans and credit * debit and credit cards * fees and rates * transaction errors * misrepresentation; * accounts sent to collections
OBSI is able to make recommendations for amounts up to $350,000. OBSI currently has more than 600 participating firms in Canada, including:
*
Investment Industry Regulatory Organization of Canada The Investment Industry Regulatory Organization of Canada (IIROC; ''Organisme canadien de réglementation du commerce des valeurs mobilières'' or ''OCRCVM'' in French) is a non-profit, national self-regulatory organization (SRO). Established thro ...
(IIROC) member firms * Mutual Fund Dealers Association of Canada (MFDA) member firms * Mutual fund companies * Exempt market dealers * Portfolio managers * Scholarship plan dealers * Forex trading services * Banks * Credit unions * Federal trust and loan companies and other deposit-taking organizations
A full list of firms that participate in OBSI can be found a
www.obsi.ca here


Complaints that OBSI won't deal with

If the customer's complaint involves an insurance company, the customer should contact one of the insurance ombudservices to see if they can help. Th
OmbudService for Life and Health Insurance
(OLHI) deals with concerns about life and health insurance, including disability, while th
General Insurance Ombudservice
(GIO) covers issues of car, property and business insurance. Along with OBSI, the insurance services are part of th

a network of dispute resolution services working to resolve complaints fairly and impartially. OBSI won't take on a complaint if:
* The customer or the firm has started a court action or arbitration process * The firm responded to customer’s complaint, and the customer did not bring it to OBSI on a timely basis * The customer has already settled the complaint by accepting an offer from the firm * It’s about a general commercial decision of the firm, such as an interest rate or a credit decision


Governance

OBSI's governance structure is designed to ensure the
Ombudsman An ombudsman (, also ,), ombud, ombuds, ombudswoman, ombudsperson or public advocate is an official who is usually appointed by the government or by parliament (usually with a significant degree of independence) to investigate complaints and at ...
and staff are independent and impartial, and have the necessary resources to carry out their jobs. A non-profit and independent organization, OBSI is overseen by a
Board of Directors A board of directors (commonly referred simply as the board) is an executive committee that jointly supervises the activities of an organization, which can be either a for-profit or a nonprofit organization such as a business, nonprofit organiz ...
. A majority of the directors are independent, and have not been part of industry or government for at least five years. A minority of the directors are appointed from lists of nominees provided by industry bodies. The directors also comprise the voting membership of the organization. OBSI is headed by the Ombudsman has two teams of investigators: one for Banking Services and the other for Investments. The Ombudsman is also independent of industry and government.


Funding

OBSI levies fees on all of participating firms based on their size or volume of business. OBSI's budget is set each year by the Board of Directors based on the advice of staff.


International Network of Financial Services Ombudsman Schemes

OBSI is a member of the
International Network of Financial Services Ombudsman Schemes International is an adjective (also used as a noun) meaning "between nations". International may also refer to: Music Albums * International (Kevin Michael album), ''International'' (Kevin Michael album), 2011 * International (New Order album), ' ...
, a global association whose members operate as out-of-court dispute resolution mechanisms in the financial sector. Other members include:
* Financial Ombudsman Service (Australia) * Financial Services Ombudsman's Bureau of Ireland * Ombudsman for Banking Services (South Africa) *
Financial Ombudsman Service The Financial Ombudsman Service is an ombudsman in the United Kingdom. It was established in 2000, and given statutory powers in 2001 by the Financial Services and Markets Act 2000, to help settle disputes between consumers and UK-based bus ...
(United Kingdom)
A list of all members can be found at the International Network'
website


References

''Investment Executive'
CSA expands OBSI mandate
br /> Business News Networ
The Future of Canada's National Bank Ombudsman
br /> ''Canadian Press'
Rise seen in financial abuse of the elderly
''Chinese News'
Unsuitable advice leads to compensating clients, OBSI
br /> ''The Globe and Mail'
https://www.theglobeandmail.com/globe-investor/banks-should-not-have-choice-of-dispute-mediator-ombudsman/article2368314/
br /> ''The Globe and Mail'
Strengthen banking ombudsman, panel urges
br />


External links


Ombudsman for Banking Services and Investments (OBSI) website

OBSI 2012 Annual Report

OBSI Rapport Annuel 2012
{{DEFAULTSORT:Ombudsman For Banking Services And Investments (Obsi) Financial regulatory authorities of Canada Banking organizations