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Low- to middle-income households are more likely to access the services of the Ombudsman for Banking Services and Investments (OBSI), and mutual funds top the list of most complained about product, according to a new report.

Roughly 65% of consumers who contact OBSI each year are in low-to-middle income households, says the ombudsman’s Report on Income and Canadian Financial Complaints, released on Thursday.

“The complexity of products, complexity of regulation and other informational barriers are compounded by limited resources, especially for lower- and middle-income households,” said Sarah Bradley, ombudsman and CEO, OBSI, in a release. “These factors combine to create very real barriers to access to justice that disproportionately impact lower- and middle-income families.”

Complaints from lower-income households, in particular, were likely to come from women over the age of 50 and living in single-income homes.

The report was based on OBSI demographic and case data from almost 1,000 closed cases that were resolved between 2017 and 2019. The cases were grouped into three categories: lower-income households of under $60,000; middle-income households of between $60,000 and $100,000; and higher-income households of over $100,000.

When it came to investment products, 48% of complaints from lower-income households were about mutual funds, while 40% from both middle-income and higher-income households were about mutual funds. The next two products investors were likely to complain about were common shares and scholarship trust plans.

The most common investment-related issue for lower-income households was investment suitability, at 37%, followed by 29% for middle-income households and 28% for higher-income households. Lower-income households were more likely to complain about suitability relating to common shares than the other household categories, which were just as likely to complain about fee disclosure and misrepresentation.

In terms of banking products, all three household categories were likely to complain about credit cards — 28% of low-income households, 32% of middle-income households and 29% of higher-income households — while fraud was the most common type of complaint to OBSI related to banking issues.

OBSI proposed several solutions for mitigating these complaints and overcoming financial barriers to justice, including: supporting an accessible and effective financial ombudsman service; clearer disclosure and greater scrutiny of financial programs marketed to lower-income consumers; and streamlining and simplifying the dispute resolution process for financial services consumers.