Bloggers note : the push back was so perfect.. so well rehearsed..so unequivocal.\
#ForTherecord #BMO #TWU #Money #Investing #Finance #Mortgage # MoveMyMoney #BMOfiasco
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Canada’s big banks defend themselves at parliamentary committee
The
country’s major financial institutions have faced allegations of
questionable sales tactics, with employees saying they were pressured to
sell unnecessary products to clients.
OTTAWA—Canada’s big
banks defended their business practices Monday before a parliamentary
committee that’s been exploring allegations of questionable sales
methods at major financial institutions.
The committee launched the hearings following media reports
citing unnamed employees at the five largest banks who alleged they
were pressured to sell unnecessary products and services in order to
boost profits and meet difficult-to-reach sales objectives.
Representatives
of the country’s largest banks strongly denied that such accusations
were part of their cultures.
Yet most acknowledged that occasional cases
of inappropriate behaviour are possible, since the financial
institutions are massive operations with many client interactions.
The
bank officials represented CIBC, Scotiabank, TD, BMO, RBC and the
National Bank of Canada, which was not named in the series of reports by
the CBC.
They all insisted the needs of
their customers always come first, which they argued was a crucial
ingredient for a successful banking business.
The
bankers also say they enforce codes of conduct, invite staff and client
feedback through confidential channels, regularly offer fresh training
for employees and are determined to address any inappropriate sales
behaviour.
They all said the allegations that appeared in the reports
are unacceptable and that all issues with client interactions are taken
seriously.
Andrew
Pilkington, TD’s executive vice-president of branch banking, said after
the allegations emerged, he travelled to his company’s locations across
Canada to find out if employees felt intense pressure to sell.
“Our employees — the vast majority — feel that’s just not the case,” Pilkington said.
“We’re
not saying we’re perfect, in fact, this is a good time for us to stop,
pause, reflect (and) see what else we can do to actually strengthen our
controls so that we can absolutely mitigate the risk that you’re talking
about.”
Andrew Auerbach, an executive
vice-president for BMO, told the committee his bank would never suggest
selling products that are not appropriate for the customer.
“It’s
just not consistent with who we are as a company,” Auerbach said,
adding that when instances of inappropriate behaviour are identified,
they’re thoroughly investigated, case by case, and action is taken.
The
CBC said that after its initial report, it received nearly 1,000 emails
from employees of the five largest banks. The workers alleged in the
emails that they felt pushed to “upsell, trick and even lie to
customers” to reach goals constantly tracked by their employers.
“Issues
that came to light in the media have never, ever been mentioned, to me
anyways, through my tours through the banking centre network,” said
Scott Wambolt, senior vice-president for CIBC.
“There
are a number of checks and balances in the system to make sure that if
an employee or a customer feels that something inappropriate has
happened that they can raise the issue through a number of different
channels.”
James McPhedran, a Scotiabank
executive vice-president, testified that his bank always makes it clear
to employees that it does not compromise its ethics to meet sales or
other targets.
“Adherence to our code of conduct is non-negotiable,” he said.
Kirk
Dudtschak, an executive vice-president for RBC, told the committee his
bank doesn’t take for granted the role it plays in the lives of its
employees and clients.
The committee has
already heard from Financial Consumer Agency of Canada commissioner
Lucie Tedesco. Her agency has launched a review of bank business
practices and she said the initial findings are due by the end of the
year.
Tedesco said if the review discovers
that laws were broken, her agency will conduct investigations and take
any necessary enforcement measures, which could include penalties
against the financial institutions.
Last week, the committee heard allegations
through first- and second-hand accounts made by former bank employees
that workers feel pressure to hit unreasonable sales goals, entice
clients into raising their credit-card limits and offer mortgages beyond
what clients can reasonably afford.
