OBSI 2023 Annual Report released
In 2023, OBSI responded to more than 17,000 public inquiries – a 63% year-over-year increase from the record levels reached in 2022.
TORONTO, March 15, 2024 (GLOBE NEWSWIRE) -- The Ombudsman for Banking Services and Investments (OBSI) released its 2023 Annual Report.
In 2023, OBSI responded to more than 17,000 public inquiries – a 63% year-over-year increase from the record levels reached in 2022. This was largely driven by banking inquiries that rose 56% when compared to 2022. Investment inquiries increased by 22% year over year.
In total, OBSI opened 3,050 cases in 2023, compared to last year’s record high of 1,151, representing a 165% year-over-year increase.
“This was a pivotal and groundbreaking year for OBSI. Our organization successfully met some very significant operational challenges as consumer demand for our services soared,” said Sarah Bradley, Ombudsman and CEO, OBSI. “The number of Canadians who reached out to us for information and assistance set a new record in 2023, following on several consecutive years of record high demand.”
Banking cases increased 248% year over year to 2,388, up from 686 cases in 2022.
“Banking led the surging case and inquiry volumes, largely due to the new Consumer Protection Framework provisions of the Bank Act that came into force in mid-2022. These changes were intended to and in fact have reduced complainant attrition significantly and, as a result, we are seeing dramatically more cases escalating to us,” said Ms. Bradley. “Much of this record high complaint volume relates to e-transfer fraud and credit card fraud.”
Investment cases increased overall by 42% in 2023 to 662, up from 465 cases in 2022.
“At the same time, investments cases reached record high levels, led by suitability and crypto asset fraud cases,” said Ms. Bradley.
Banking case highlights
In 2023, banking complaints related to fraud more than quadrupled to 950 cases, up from 215 cases in 2022, representing 40% of OBSI’s total banking cases (up from 31% in 2022). There were 427 banking cases centered around service issues, representing 18% of all banking cases. This marked an increase from 130 cases in 2022. Additionally, credit card chargebacks saw a significant increase, tripling in volume to 153 cases (6% of all banking cases) in 2023, compared to 49 cases (7% of all banking cases) in 2022. Complaints related to interest rates rose to 134, up from 26 cases in 2022.
The top banking product concerns focused on credit cards, e-transfers, and personal chequing and savings accounts. Specifically:
- Credit card complaints led with 748 cases (31% of all banking cases).
- E-transfer complaints followed closely with 621 cases (26% of all banking cases).
- Personal savings and chequing account complaints accounted for 317 cases (13% overall).
Investment case highlights
Investment suitability was the leading issue for investors in 2023, representing 27% of investment cases, up from 15% in 2022. Fraud complaints doubled in volume from 50 cases in 2022 to 100 cases in 2023, increasing from 11% to 15% of investment cases overall. Case volumes related to service problems (technical and non-technical) were flat year over year but accounted for 15% of all investment cases in 2023, down from 21% in 2022. Notably, cases related to instructions not followed increased from 36 cases in 2022 to 50 cases in 2023.
Mutual funds remained the most complained-about investment product in 2023, representing 45% of all investment complaints, up from 37% in 2022. Common shares (equities) decreased to 27% in 2023, from 33% in 2022. Crypto assets, which were a new product category for 2022 due to regulatory changes, almost doubled in volume from 52 cases to 101 cases and accounted for 11% of all investment cases in 2022 vs. 15% in 2023 to remain the third most common complaint for investors this year.
Systemic issues and disclosures to regulators
In 2023, OBSI continued its practice of communicating regularly with financial services regulators about systemic issues and issues affecting multiple consumers. During the year, a range of topics were reported and discussed at meetings with regulators that included:
- Detailed aggregate data including:
- Products, issues and outcomes details and trends
- Specific (anonymized) case outcomes and summaries
- Additional information relating to cases involving low settlements
- Cryptocurrency fraud cases
- OBSI’s completed and planned responses to the 2021 external reviews
- Information relevant to the effective transition to the single ECB framework for Canadian banks
OBSI also discussed with the CSA considerations related to binding authority to help the proposed framework meet the needs of Canadian investors, and reported a case-specific, investment-related systemic issue involving inconsistencies in the risk rating approaches adopted by different fund groups when applying the CSA risk classification methodology to their funds and instances of misapplication of the CSA risk classification methodology to investment funds not subject to NI 81-102.
Canada’s Ombudsman for Banking Services and Investments (OBSI) is a national, independent, not-for-profit organization that helps resolve and reduce disputes between consumers and financial services firms in both official languages. OBSI is responsive to consumer inquiries, conducts fair and accessible investigations of unresolved disputes, and shares its knowledge and expertise with all stakeholders and the public. If a consumer has a complaint against an OBSI participating bank or investment firm that they are not able to resolve with the bank or firm, OBSI will investigate at no cost to the consumer. Where a complaint has merit, OBSI may recommend compensation up to a maximum of $350,000.
For more information, please contact:
Mark Wright, Director, Communications and Stakeholder Relations
416-287-2877 ext.2225
[email protected]
