The sanction comes after the bank self-reported discoveries of overcharging
The OSC has ordered CIBC investment dealers to pay over $73 million to clients who were unintentionally overcharged fees, according to a report by the Globe and Mail. This comes as part of a no-contest settlement between the regulator and CIBC World Markets Inc., CIBC Investor Services Inc. and CIBC Securities Inc.
The dealers accidentally charged excess fees for mutual funds, ETFs, and other investment instruments as far back as 2002, the OSC alleged. The activities were self-reported by CIBC after it discovered “inadequacies” in the way it was charging some customers for investment products.
The settlement agreement indicates that the CIBC neither admitted nor denied the accuracy of the facts and conclusions of the OSC. It also said the OSC found no evidence that the three CIBC dealers acted dishonestly.
"We will begin reaching out to affected current and former clients to compensate them," said CIBC spokesperson Caroline Van Hasselt in an emailed statement. "We regret the inconvenience this has caused our clients and have taken corrective action by implementing additional controls to prevent it from occurring again."
The dealers were cooperative in the investigation, according to the provincial regulator, and have put in place additional checks and oversight systems to prevent a recurrence. They have also paid $3 million toward the OSC’s mandate of investor protection, and an additional $50,000 for investigation costs.
"Strong compliance systems are critical to investor protection and market confidence," said OSC Director of Enforcement Jeff Kehoe. "We expect registrants to have effective controls in place to deal fairly with clients with regard to fees, and to correct non-compliant conduct in a timely manner."
Related stories:
CIBC divisions admit to overcharging
New enforcement head for provincial regulator
The dealers accidentally charged excess fees for mutual funds, ETFs, and other investment instruments as far back as 2002, the OSC alleged. The activities were self-reported by CIBC after it discovered “inadequacies” in the way it was charging some customers for investment products.
The settlement agreement indicates that the CIBC neither admitted nor denied the accuracy of the facts and conclusions of the OSC. It also said the OSC found no evidence that the three CIBC dealers acted dishonestly.
"We will begin reaching out to affected current and former clients to compensate them," said CIBC spokesperson Caroline Van Hasselt in an emailed statement. "We regret the inconvenience this has caused our clients and have taken corrective action by implementing additional controls to prevent it from occurring again."
The dealers were cooperative in the investigation, according to the provincial regulator, and have put in place additional checks and oversight systems to prevent a recurrence. They have also paid $3 million toward the OSC’s mandate of investor protection, and an additional $50,000 for investigation costs.
"Strong compliance systems are critical to investor protection and market confidence," said OSC Director of Enforcement Jeff Kehoe. "We expect registrants to have effective controls in place to deal fairly with clients with regard to fees, and to correct non-compliant conduct in a timely manner."
Related stories:
CIBC divisions admit to overcharging
New enforcement head for provincial regulator
