Investments

Here are your options if you have lost money in an investment such as a mutual fund, stock or bond because of an error, disagreement or possible misconduct.

Compensation process for investments

Step 1

Start with the investment firm

Start with the person or firm you dealt with. Investment firms are required to have internal processes for handling consumer complaints and to provide information in writing to consumers about the process. The firm is required to respond to you if you make a complaint about a product or service offered by the firm or recommended by a representative of the firm.

If you are not satisfied with the response from the internal complaint handling process, find out if the firm has an internal ombudsman service or consider other options.

Step 2

Contact the internal ombudsman if one is available

An internal ombudsman service impartially investigates consumer complaints free of charge and assists the parties in reaching a resolution. Your participation in the firm’s ombudsman service is voluntary. You can pursue other options if an agreement cannot be reached.

Step 3

Consider other options

Here are other options to consider that may be available to you:

Ombudsman for Banking Services and Investments (OBSI)

OBSI is a free, independent service for resolving banking and investment disputes between participating firms and their clients. You can bring your case to OBSI if:

  • the firm has not provided its final response to you within 90 calendar days of the date you complained, or
  • you are not satisfied with the firm’s final decision on your complaint.

You have up to 180 days after receiving the firm’s response to get in touch with OBSI. OBSI can recommend compensation of up to $350,000.

You can find more information and a list of participating firms on the OBSI website.

IIROC arbitration program

The Investment Industry Regulatory Organization of Canada (IIROC) has designated two independent arbitration organizations for resolution of disputes between IIROC-regulated firms and clients. IIROC rules require the firms regulated by IIROC to participate in an arbitration program if a client chooses this option. You can find more information about the arbitration program and a list of regulated firms on the IIROC website.

Regulatory action

If you think an individual or firm has broken the rules, contact the securities regulator in your province or territory. Regulators investigate potential wrongdoing and can impose sanctions on individuals and firms that breach regulatory requirements.

Securities regulators normally do not recover money for consumers. However, securities regulators in Manitoba, New Brunswick and Saskatchewan have the authority to order that you be compensated. The consumer must file a claim for compensation with the regulator.

For more information about the options available to you, contact the securities regulator in your province or territory, or consult a lawyer. You can find contact information for securities regulators on the Canadian Securities Administrators (CSA) website.

If you live in Québec . . .

The Autorité des marchés financiers (AMF) offers a free mediation service for consumers who live in Québec and are not satisfied with the response from the financial institution’s internal complaint handling process. The AMF will review the complaint and may offer assistance to the consumer and investment firm in reaching a resolution. Participation in the service is voluntary and both the firm and consumer must consent to it. Consumers can pursue other options if an agreement cannot be reached. You can find more information about the AMF mediation service on the AMF website.

The AMF also has a compensation fund that pays compensation to eligible victims of fraud, fraudulent tactics or embezzlement by mutual fund dealers registered with the AMF to carry on professional activities in connection with the distribution of financial products and services. You can find more information about the AMF compensation fund on the AMF website.

Legal action

You can take legal action through the courts to recover financial losses from a representative and/or investment firm for alleged misconduct. Each province and territory has a time limit for taking legal action.

You may want to consult a lawyer to get advice on your rights and options. Your provincial or territorial law society can help you find a lawyer. For a list of provincial and territorial law societies, visit the Federation of Law Societies of Canada website.

 

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Definitions

Representative includes advisers, dealers, financial consultants, investment advisers and counsellors, portfolio managers, insurance brokers and agents, insurance advisers and consultants, insurance representatives, securities dealers, wealth management advisers, mortgage brokers and agents.