Give OBSI binding power, says independent evaluator

OBSI has released the results of an independent evaluation of its operations and practices for investment-related complaints.

Read: Are firms responsible for advisor misconduct?

Deborah Battell, former New Zealand Banking Ombudsman, led the evaluation and presented her findings separately to OBSI’s Board of Directors and to the Joint Regulators Committee, which includes representatives from the Canadian Securities Administrators (CSA), the Investment Industry Regulatory Organization of Canada, and the Mutual Fund Dealers Association of Canada.

Among the report’s key conclusions:

• OBSI meets the requirements of the Memorandum of Understanding with the CSA and has performed well within its current mandate: its decisions are fair and consistent with those made internationally; and with its loss calculation tools, its ability to determine fair amounts of compensation is world leading.
• OBSI has made exceptional progress since the previous independent review – the main improvements have been in governance, obtaining regulators’ confidence to expand its mandate, and eliminating the backlog of complaints.

Read: Suitability issues most common complaint: OBSI

• OBSI is unlike other comparable international financial sector ombudsmen in that it does not have the authority to bind firms to comply with its compensation recommendations. This drives its operating model and prevents it from fulfilling the fundamental role of an ombudsman, securing redress for all consumers who have been wronged.
• OBSI should be enabled to secure redress for consumers.
• OBSI should adopt a strategic approach to ombudsmanship, incentivizing staff to use the intelligence gained from cases to help avoid and reduce the incidence of complaints.

Read: IIROC wants court authority to collect fines

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.