Financial Consumer Agency of Canada

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3. > Laws, Regulations and Other Obligations
4. > Banks and federal credit unions

Overview of Obligations for Federal Banks and Federal Credit Unions

The Bank Act is the primary legislation governing banks and federal credit unions¹ in Canada. FCAC is responsible for administering sections of the Act designated as consumer provisions, in addition to monitoring the financial institutions’ compliance with voluntary codes of conduct and public commitments.

The complete text of the Act can be found on the Department of Justice Canada’s website. For your convenience, we have also extracted the specific sections related to consumer provisions.

Bank Act

Bank Act Regulations

• Access to Basic Banking Services Regulations
• Cheque Holding Policy Disclosure (Banks) Regulations
• Complaint Information (Authorized Foreign Banks) Regulations
• Complaint Information (Banks) Regulations
• Cost of Borrowing (Authorized Foreign Banks) Regulations
• Cost of Borrowing (Banks) Regulations
• Credit Business Practices (Banks, Authorized Foreign Banks, Trust and Loan Companies, Retail Associations, Canadian Insurance Companies and Foreign Insurance Companies) Regulations
• Deposit Type Instruments Regulations
• Disclosure of Charges (Authorized Foreign Banks) Regulations
• Disclosure of Charges (Banks) Regulations
• Disclosure of Interest (Authorized Foreign Banks) Regulations
• Disclosure of Interest (Banks) Regulations
• Disclosure on Account Opening by Telephone Request (Authorized Foreign Banks) Regulations
• Disclosure on Account Opening by Telephone Request (Banks) Regulations
• Mortgage Insurance Disclosure (Banks, Authorized Foreign Banks, Trust and Loan Companies, Retail Associations, Canadian Insurance Companies and Canadian Societies) Regulations
• Notice of Branch Closure (Banks) Regulations
• Notices of Deposit Restrictions (Authorized Foreign Banks) Regulations
• Notices of Uninsured Deposits Regulations (Banks)
• Prescribed Deposits (Authorized Foreign Banks) Regulations
• Prescribed Deposits (Banks without Deposit Insurance) Regulations
• Prescribed Products Regulations
• Principal Protected Notes Regulations
• Public Accountability Statements (Banks, Insurance Companies, Trust and Loan Companies) Regulations
• Registered Products Regulations

Voluntary codes of conduct

• Canadian Bankers Association's Code of Conduct for Authorized Insurance Activities

  This code outlines the banks’ standards for branch employees selling credit, travel and personal accident insurance. It deals with training, disclosure, promotion practices, customer privacy protection and complaints procedures.

• Canadian Code of Practice for Consumer Debit Card Services

  This code of conduct is designed to protect Canadian consumers who use debit card services. It outlines industry practices as well as the responsibilities of and consumers and the industry in relation to debit card transactions and liability.

• Code of Conduct for Credit and Debit Card Industry in Canada

  This code applies to debit and credit card networks and their participants. It outlines payment card networks operators’ responsibilities for providing information, flexibility and choice to merchants.

• Canadian Bankers Association's Model Code of Conduct for Bank Relations with Small- and Medium-Sized Businesses

  The Canadian Bankers Association (CBA) has developed a code of conduct model that states minimum standards for banks dealing with small- and medium-sized enterprises (SMEs). The code outlines the banks’ responsibilities when it processes loan or credit applications by small- and medium-sized businesses. Each bank develops and applies its own code to the business activities it conducts with SMEs. However, all bank codes include the key elements of the CBA model.

• Principles of Consumer Protection for Electronic Commerce: A Canadian Framework

  These principles are intended to guide the actions of businesses, consumers and governments in Canada in developing a consumer protection framework for electronic commerce over open networks, including the Internet. The framework also clarifies the responsibilities associated with the service.

Public commitments

• Canadian Bankers Association's Cheque holds

  Banks have undertaken a voluntary commitment to reduce the maximum period of time for which they will hold funds deposited by cheque. Cheques must not be damaged in any way, and must be drawn on a financial institution in Canada, in Canadian dollars.

Fraud protection

Several organizations and institutions have made formal commitments to protect consumers from the unauthorized use of their credit card. These commitments outline consumers' liability in relation to fraudulent transactions on their credit card.

American Express
MasterCard
Visa
Interac

Low-Cost Accounts

Eight Canadian banks (BMO Bank of Montreal, CIBC, HSBC Bank Canada, Laurentian Bank, National Bank, RBC Royal Bank, Scotiabank and TD Canada Trust) committed to offer accounts that meet guidelines set out by the federal government, with the aim of ensuring that Canadians have access to affordable banking services.

For more information about various low-cost accounts available, see FCAC's publication entitled Tips About Low-Cost Bank Accounts.

Canadian Bankers Association's Guidelines for the Transfer of Registered Plans

A commitment outlining the maximum amount of time that banks may require when transferring a registered savings plan (RSP) containing deposit type instruments, mutual funds or securities between financial institutions.

Canadian Bankers Association: Online Payments

This public commitment outlines consumer and industry responsibilities related to the use of online payment systems in Canada. A process for dealing with disputes is included in the commitment.

Canadian Bankers Association Commitment: Plain-Language Mortgage Documents

This document reflects the Canadian Bankers Association member banks’ commitment to improving the understandability of residential mortgage documents.

Undertaking on Unsolicited Services

This undertaking is signed by six Canadian banks (BMO Bank of Montreal, CIBC, National Bank, RBC Royal Bank, Scotiabank and TD Canada Trust) that have committed to implementing procedures designed to protect consumers when offering new unsolicited services.

Date Modified:

2012-01-11

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