Court denies appeal in client overcharging case

An Ontario court has rejected the appeal of a former bank compliance officer who sought to reopen a client overcharging case against various TD Bank subsidiaries.

The Court of Appeal for Ontario rejected an appeal from former employee Marian Carroll, which argued that the Superior Court of Justice erred in a March 2020 ruling when it dismissed her suit alleging that a regulatory settlement in 2014 involving client overcharging significantly understated the issue.

Several of the bank’s subsidiaries reached a $14-million settlement with the Ontario Securities Commission (OSC) to resolve allegations that it systematically overcharged certain clients.

According to the court’s decision, Carroll alleged that the regulatory settlement understated the extent of the issue. Specifically, it said, “she issued an application seeking orders that would result in the disclosure, discovery, and redress of financial irregularities and misconduct, if any, by TD relating to its role as trustee of designated mutual funds.”

The Superior Court dismissed the case last year, ruling that she had no standing to bring her application.

Now, the appeal court has upheld that lower court’s decision, dismissing Carroll’s appeal.

The appeal argued that the motions judge erred on several grounds, including that the court failed to invoke its inherent jurisdiction to supervise trusts, that the judge applied the wrong test for standing, and that she failed “to consider all aspects of the relief sought” when determining Carroll’s standing, among others.

The appeal court dismissed all of these arguments, upholding the lower court decision.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.