On January 26, 2022, the Financial Consumer Agency of Canada (the FCAC) published its Guideline on Complaint-Handling Procedures for Banks and Authorized Foreign Banks (the Guideline) to set out its expectations with respect to Banks’ and Authorized Foreign Banks’ (Banks) implementation of the complaint-handling provisions in the Bank Act and the Financial Consumer Protection Framework Regulations. The Guideline is framed by the principles of effectiveness, timeliness and accessibility, and the FCAC recommends that Banks should be guided by these principles when establishing and implementing their complaint-handling policies and procedures (the Policies).
Under the Guideline, a Bank has a continuing obligation to provide a copy of its most-current Policies to FCAC to continue operating as a Bank. Banks must also designate one officer or employee in Canada to be responsible for implementing its Policies, and at least one employee in Canada to receive and deal with any complaints (the “Designated Employee”); the same employee may act in both positions.
For Policies to be effective, the Guideline indicates that they should:
- Address the roles and responsibilities of employees involved in complaint-handling;
- Include formal training on complaint-handling;
- Include mechanisms for identifying and remedying any recurring or systemic problems; and
- Include a comprehensive redress policy that provides its consumers with redress and reimbursement.
For Banks to handle complaints in a timely manner, the Guideline recommends that Banks’ Policies document the resolution or closing of complaints and include clear steps to resolve or close complaints within the 56-day period prescribed by Financial Consumer Protection Framework Regulations. Although any employee may deal with a complaint if they are the first point of contact between the Bank and the consumer, Banks should refer complaints that have not been closed or resolved within 14 days from the time the complaint was first received to a Designated Employee. Any input, assistance or involvement from a Designated Employee in handling a complaint will be deemed a “referral” and therefore a Bank must report it to FCAC.
To increase accessibility to the complaints process, the Guideline suggests that Banks’ Policies indicate the different channels in which a consumer may make a complaint, the Bank’s process and the actions that will follow, the consumer’s right to submit a complaint to the external complaints body, and how to contact FCAC. Banks should provide consumers with the information and documentation they need in order to submit a complaint. Additionally, Banks should publish complaint-related statistics on their website, updated annually, including the number of complaints that its most senior Designated Employee dealt with and the average length of time that the Bank took to deal with those complaints; the products or services to which the complaints related; descriptions of the complaints received; and the number of resolved complaints. Whenever a complaint is submitted, Banks should provide consumers with a receipt of acknowledgement, and a “substantive written response” should be provided to the consumer whenever a complaint is either closed by any employee, or resolved by a Designated Employee. This substantive written response should provide all the information a Consumer needs to make an informed decision on whether to submit the complaint to a Bank’s external complaints body, if they so choose.
For more information on the complaints-handling process, reach out to Tracy Molino or Angela Shaffer.