Self Help options are touted by the financial industry. This is no coincidence. Self Help options are designed by the financial industry for the industry’s own benefit. The alleged independence and remedies of the Self Help decision makers are routinely questioned by those outside of the financial industry. The questions are about the lack of results - why are complaints routinely denied by Self Help decision makers and later both compensated by the courts and sanctioned by regulators?
There are a number of options for bring a complaint against a financial advisor. Outside of the minimalist regulatorion ”wild west” of the financial advice from banks, all advisors are regulated by either the provincial Insurance Regulator or by the Mutual Fund Dealers Association or the Investment Industry Regulatory Organization of Canada and/or the provincial Securities Commission. None of these regulators will assist you in recovering your financial loss. If you seek revenge or to protect the public’s interest, then these regulators have a role.
Most financial firms offer an internal complaint process. These processes are opaque, lacking in fairness, lacking in disclosure and are widely seen to be delay and excuse efforts by the financial firms. Given the shortened time line for pursuing loss recovery in the courts, delay can be fatal.
The Investment Industry Regulatory Organization of Canada offers an optional arbitration program for losses of $100,000 or less. This program has received widespread criticism from non-industry commentators. This program has great potential but is hobbled by the disportionate resources brought to bare by defendants and the perceived bias of the arbitrators.
The Ombudsperson of Banking Services also offers a complaint process. This is a free service for IIROC, MFDA, Investment Funds Instutite of Canada, and the Canadian Bankers Assocation. This industry process is available for claims for loss up to $350,000. This too has been widely criticised as powerless and ineffective. So too, the results consensually obtained on occassion by the OBSI are far below a comprable compensation that would be awarded by a court. Who’s interest are served when a token payment is made through the OBSI to get rid of a valid claim for financial loss?
Any individual can self-advocate before the courts. Again, the disproportionate resources brought to bare by defendants make this an unpalatable option.
Unfortunately, while there is the appearnce of Self Help options for financial loss recovery this appearance is a mirage that benefits the financial industry. The best Self Help options available are when investors turn to experts to assist them to help the investor to recover her/his loss.