Canadian Fund Watch

 

Commentary on Investment Dealer complaint handling

 

People often complain about Dealer complaint systems because they can be complex, time-consuming, and frustrating, leading to perceived lack of resolution or responsiveness. 

Based our experience in assisting complainants , here is  a breakdown of common complaints about complaint systems: 

1. Complexity and Lack of Clarity: 

Difficult Navigation:

Many systems are poorly designed, making it hard to find the right channels or information. . 

Confusing Processes:

The steps involved in filing and resolving a complaint can be unclear, leading to frustration and wasted time/effort. 

Lack of Accessibility:

Systems may not be accessible to all users, such as those with disabilities , language issues, lack of internet or limited tech skills. 

 

2. Inefficiency and Delays: 

Long Wait Times:

Getting a response or resolution can take an unreasonable amount of time, causing further frustration. Dealers offer non-independent internal appeal mechanisms which needlessly add to cycle time.

Lack of Timely Updates:

Complainants may not receive adequate updates on the status of their complaint, leaving them feeling in the dark. 

Unnecessary Escalation:

Simple issues may require unnecessary escalation to higher levels, further delaying resolution and adding to aggravation  “ complainant fatigue”. 

 

3. Lack of Resolution and Fairness: 

Unsatisfactory Resolutions:

Complaints may be dismissed or resolved in a way that does not address the underlying issue or provide adequate compensation for losses.This is far too common .

Perceived Bias:

Complainants may feel that the system is biased towards the Dealer  they are complaining against. This is a frequent complaint with evidence from employees prioritized over that provided by complainants. There also attempts to divert complainants away from OBSI.

Lack of Accountability:

There may be a lack of accountability for the Dealer or individuals involved in the complaint. More senior management is needed

 

4. Other Common Issues: 

Inadequate Documentation:

Systems may not provide clear and accessible documentation about complaint procedures or rights. Loss calculation methodology not publicly available 

Poor Communication:

Communication with complainants may be infrequent, impersonal, legalistic , disrespectful or unhelpful. 

Lack of Transparency:

The process of handling complaints may not be transparent, making it difficult for complainants to understand Dealer responses 

Focus on Form over Function:

Systems may prioritize paperwork and procedures over actually addressing the issues raised by complainants. Too often a PR exercise.

All in all, a very difficult process for the average retail investor to navigate. Regulators need to provide a modern complaint handling rule for Dealers to adhere to.