Evidence of meeting #98 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was banks.
A video is available from Parliament.
Commissioner, Executive Services, Financial Consumer Agency of Canada
The issue of “adviser” or “advisor” is an issue that deals with securities. We don't have oversight over—
Liberal
Raj Grewal Liberal Brampton East, ON
That's fine. The only question is whether this was ever flagged.
At a certain point, it's not about the jurisdictional comment, because there is only one taxpayer. Your job is to protect Canadians, at the end of the day.
I'll pass it off to the Canadian Bankers Association. Your members are taking advantage of this glitch. You could pass the buck to me and say that it's not federal jurisdiction, and that's fine. You're well within your legal right to do that.
I totally understand the constitutional argument, but at a certain point, don't you think that substituting an “o” for an “e” to say that a customer service rep can use “financial advisor” as a title because it's unregulated is the definition of deception?
Vice-President, Finance, Risk and Prudential Policy, Canadian Bankers Association
I'm really glad you've raised this, because there is a lot of misunderstanding around this issue. I'll let my colleague, Ms. Stephens, speak on it here for a moment, because I think it really needs clarification.
Assistant Legal Counsel, Canadian Bankers Association
“Adviser” is a term that is used in securities regulation for a defined set of functions, but an “advisor” is a more generic term. The reality is that people are regulated based on their functions and activities. If they're doing certain functions that fall within the “adviser” category, they would be regulated that way.
Vice-President, Finance, Risk and Prudential Policy, Canadian Bankers Association
Put another way, if you are in a regulated institution doing a regulated activity, the regulator is going to regulate you, and one vowel isn't going to change that.
Liberal
Vice-President, Finance, Risk and Prudential Policy, Canadian Bankers Association
It speaks to the industry.
Liberal
Raj Grewal Liberal Brampton East, ON
I will say this.
Suppose you're a normal Canadian and you walk into one of the big six banks. Suppose you come across a university student who is working the till that day and whose title is “financial advisor,” the unregulated version. Suppose he then makes a pitch to you saying that you can save a certain amount of money by switching to x account and that you should invest your money in y, and suppose you rely on that advice. That's an unregulated securities transaction, in my opinion.
From my experience—and you can correct me if I'm wrong—this occurs more often than not at our banks. I believe that is an issue. Again, I'm not picking on the banks here. I just find it amazing that they would actually issue business cards with both “adviser” and “advisor”. It just seems like a problem they wouldn't want to have. Wouldn't you agree?
Vice-President, Finance, Risk and Prudential Policy, Canadian Bankers Association
As I just said, in this case, candidly, it's a distinction without a difference from a regulatory point of view. At the end of the day, you should certainly expect, as a customer, that when you go in, the financial advice you're getting, irrespective of the title, is appropriate to your financial situation and that the products and services that are provided to you suit your financial circumstance. That's what every institution strives to achieve, and that's what builds a strong customer relationship and a lasting customer relationship.
Liberal
The Chair Liberal Wayne Easter
We will have to leave it at that.
Are there any last comments that you want to make, Ms. Tedesco?
Commissioner, Executive Services, Financial Consumer Agency of Canada
Maybe picking up on that last point, if you're referring to perhaps tellers who are using the title of “advisor”, we don't oversee bank titles. It's not a specific consumer provision in the Bank Act, and that's what we oversee. However, if they're opening accounts or selling credit cards, they have to communicate with consumers who are approaching them to purchase these things in a clear, simple manner that is not misleading. That we can oversee.
Liberal
The Chair Liberal Wayne Easter
With that, thank you all for your appearances today. Also, thank you for the fairly quick time frame we asked you to appear under. You didn't have a lot of time to prepare for this meeting. We're on a tight schedule as well.
With that, thank you all for your presentations.
The meeting is adjourned.