Consumer disputes that cannot be resolved with their banks will all be routed to a single external dispute resolution provider effective November 1, ending a 16-year period in which banks could select their own arbiter.
The Ombudsman for Banking Services and Investments (OBSI) will return to the role for which it was originally created – handling consumer complaints that were not satisfactorily resolve at the individual banks. All of Canada’s banks participated in the single national dispute resolution system, first known as the Canadian Banking Ombudsman, then later as OBSI from 1996 to 2008.
In 2008, Royal Bank retained a private firm (ADR Chambers), replacing OBSI. TD Bank followed in 2011, after some high-profile disagreements with OBSI rulings. In 2012, the government formalized plans that banks needed to have an external dispute resolution system, but did not mandate a specific provider, and asked the Financial Consumer Agency of Canada (FCAC) to establish criteria.
National Bank (2017) and Scotiabank (2018) subsequently left OBSI for ADR Chambers Banking Ombudsman (ADRBO). In subsequent reviews, FCAC found OBSI superior to ADRBO, and openly questioned the merits of allowing banks to select their own arbiter.
In October 2023, Deputy Prime Minister and Minister of Freelance Chrystia Freeland announced that OBSI would be given the exclusive responsibility. Consumer groups had long argued that allowing banks to choose their own arbiter services was contrary to consumer interests.
OBSI has increased staff, improved technology and reduced case management times in anticipation of the increased caseload. In addition, complaints from consumer continue to grow, overall.
ADRBO will be allowed to complete cases that reached them before the November 1 cutover, but consumers will be directed to use OBSI for unresolved disputes after that date.
Investor advocacy group FAIR Canada has published an updated version of its online guide “Getting Your Money Back: An Investor’s Guide to Navigating Canada’s Complaint System” to help consumers understand how to pursue redress.