A federal agency tasked with reviewing how banks handle customer complaints says it will finally release its report this week, a move that comes after criticism from consumer advocates worried about what might be behind the delay in making the findings public.

The review by the Federal Consumer Agency of Canada, which is mandated to protect consumers in regard to financial services and products, was announced in November 2018.

"There is an absolute sense of urgency with respect to releasing the report," according to Marissa Lennox, the chief policy officer with CARP, a national non-profit association that promotes financial security for seniors.

As part of that review, the agency commissioned a survey that showed 43 per cent of Canadians had experienced at least one banking problem in the previous two years. Forty-one per cent who contacted their bank with a complaint said they encountered at least one barrier to resolution.

The federal agency's report was sent to the minister of finance on Nov. 29, 2019.

CARP's Melissa Lennox wondered why it was taking so long to release a review of how Canada's big banks handle customer complaints. (Sean Stante/Stante Media Inc./CARP)

The agency's spokesperson, Lynne Santerre, initially refused to put a timeline on the report's release, saying in a Feb. 4 email: "We are currently working through the various administrative processes in preparation for the public release of the report which includes editing, translation and web publishing."

"We will make the report public when ready," she said. CBC has been requesting a copy of the report since June 2019.

Four hours after CBC's story was published on Tuesday, the agency said it would release the report Wednesday.

Lennox said in a recent interview she was concerned by the delay.

She wondered if the banks are getting a preview and editing the report to show them in a more favourable light, as they did with the last FCAC report into aggressive sales tactics.

Bankers association denies seeing report

"We saw some of the recommendations in the last report were weakened or removed after it was viewed by the banks," Lennox said. "I hope that isn't happening this time."

The Canadian Bankers Association said earlier this month that it has not seen the draft or final report. The FCAC said neither a draft nor the report was shared with banks.

"It's hard to shape bad news into good news so it's probably being carefully written," said John Lawford, with the non-profit Public Interest Advocacy Centre.

"It's probably an awkward report because there's no way to sugarcoat it."

John Lawford is with the Public Interest Advocacy Centre. He pegged the report's delay on it being difficult to 'shape bad news into good news.' (Christopher Gargus/CBC)

He calls the current methods banks use to handle complaints excessively complicated and "not consumer-friendly."

He said financial regulators in the U.K. dealt with their own complaints about bank processes a number of years ago. There, he said, it was determined banks had different internal processes for dealing with customer complaints, many of them deemed unfair.

Regulators then set one standard for all banks that included fewer steps and a strict timeline for dealing with complaints.

No clear path for consumer complaints

Part of the issue in Canada is each bank has its own process for handling complaints and those processes aren't always clear to the customer.

Right now, there are two options when a customer is unhappy with a bank's response and wants to escalate a complaint.

The Ombudsman for Banking Services and Investments is a national, not-for-profit and independent organization. ADR Chambers Banking Ombuds Office is a for-profit business.

Banks get to decide which of the two they want to mediate complaints against them.

CARP, the Consumers Council of Canada and the Canadian Foundation for Advancement of Investor Rights have all urged the federal consumer agency to designate one national, independent bank ombudsman to deal with customer complaints.

One independent banking ombudsman recommended

Lennox said the current system of two ombudsmen is not in the public interest. She thinks it's clear there is a need for a single, independent office.

"The fact the banks have the freedom to choose which ombudsman office it wants to use for disputes with customers poses an inherent conflict of interest," Lennox said.

"There is a conflict when an ombudsman's office entrusted with settling disputes is paid by one of the parties to that dispute," she said.

According to the most recent annual reports from the two ombudsmen, the major banks pay approximately the same annual fees regardless of which they use. However, on top of those fees, ADR Chambers charges an additional hourly investigation rate of $290.

Ombudsman Britt Warlop of ADR Chambers said in an email that the company is regulated by the FCAC and "is committed to serving the public good by ensuring the interests of consumers are put first and that their rights are protected."

She called the company "a neutral external complaints body" with an impartial resolution dispute process that is trusted internationally.

The Ombudsman for Banking Services and Investments was the only banking ombudsman until the Harper government changed legislation allowing ADR Chambers to do the same, effective August 2015.

In November 2018, OBSI's board of directors called on the federal government to revert back to a single ombudsman.

"We believe that Canada's banking industry and banking consumers would benefit from access to a single, not-for-profit banking ombudsman dedicated to accessibility, openness, transparency, independence, fairness, and efficiency for consumers and firms — and that the government of Canada should establish such a system," the board said.

'We don't need another report'

Lawford hopes the report will break down each bank's performance in handling customer complaints, as well as their attitude toward those complaints.

"I would like to see not just a report outlining the problems, but one that says, 'Here's what they do in other countries and here's how we can change,"' Lawford said.

Stan Buell, president of the national, non-profit Small Investors Protection Association, is frustrated with the slow pace in making banks more accountable to their customers.

"We don't need another report, we need change," he said.

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