Controversial TD tactics show need for consumer code, says advocacy group

Controversialsales practices at TD Bank, revealed by CBC'sGo Public team, underscore the need for a financial consumer code in Canada, says a consumer interestgroup.

Public Interest Advocacy Centreresearch analyst Jonathan Bishop said the practices uncovered by Go Public "present a bit of a grey area" that might not be covered by existing financial regulators.

• TD teller says customers payfor 'unrealistic' targets
• TD employees admit to breaking the law

Those practices, described to CBC News by current and former TD workers,included aggressivelyupsellingcustomers on unneeded financial products, neglecting to disclose fees for products,and even signing customers up for products without their knowledge. Some tellers said they felt forced into those practices for fear of missing sales goals.

"We think that the proposed financial consumer code will provide a clear set of rules of the road, rules of engagement, between the banks and consumers," Bishop told CBC News. The code should be enforced by an independent arbitrator, he said.

"Banks will have the opportunity to present evidence to an arbitrator about what they've done, and their tactics,as well as consumers have the opportunity to present their concerns and their views."

Financial agency investigates

The Financial Consumer Agency of Canada, which enforces consumer protection regulations,said it has launched its own probe in light ofCBC's stories.

It is boring, it is time-consuming, and it is complex, but you need to audit your statements.Bruce Sellery, personal finance expert

"FCAC is concerned about and is investigating allegations about financial institutions signing consumers up for products or services without providing all the required information," wrote spokesman Michael Toope in an email to CBC News.

But Bishop said the FCAC'sapproach to enforcement can be somewhatopaque, and a financial consumer code could improve public confidence.

"We think that there is an opportunity here for more clear and direct rules that would be applicable to both banks and consumers that use them," said Bishop.

PIAChas calledfor a financial consumer code before, and submitted a consultation paper on the topic to the Ministry of Finance in 2014. A financial consumer code was proposed in the 2013 federal budget, but still does not exist.

How to protect yourself

Even without a financial consumers code, bankcustomers canprotect themselves from paying for unwanted financial products.

"It is boring, it is time-consuming, and it is complex, but you need to audit your statements," saidpersonal finance expert Bruce Sellery.

"Print off a couple of months of them and go through them line by line. Remember, you're the customer you're the customer here so there are literally no dumb questions," he said.

"Pick up your phone and dial your institution's1-800 number,and get an answer to every question you have."

Sellery also pointed out that consumers often find it hard to say no to a bank teller's sales pitch for financial products.

"Take the information with you but decline. Have that be your first instinct," he said.

• TD Bank on defensive after CBC stories, stock plunge

PIAC'sBishop agreed consumers should keep an eye on their bank statements, and added that unhappy customers should report issues to their bank's ombudsman.

"Or go to the FCAC, explain the concern, because without explaining the concerns, those organizations can't act on those concerns," said Bishop.

"And if you're really convinced that a financial consumer code might generate greater consumer confidence, tell your member of Parliament that you'd like this to be entertained."