Majority of financial complaints result in no compensation

When consumers believe they were mistreated or cheated by a financial institution, they have the right to file a complaint. However, not all complaints can be resolved to the satisfaction of consumers. Depending on the nature of the complaint, some may be awarded compensation, while others are found to be without merit and are dismissed. 
More often than not, complaints are settled without a single penny being awarded to consumers.  According to statistics provided by Ombudsman of Banking and Investment Services (OBSI), which offers dispute resolution services for banking and investment services, 85% of banking cases and 63% of investment cases result in no compensation awarded to the complainants. 
Mr. Feng Weidong (assumed name) , a newcomer to Canada, brought forward two complaints against two different financial institutions. Since the nature of the complaints is different, they have resulted in completely different outcomes.
冯因550 股Elan Corp.股票曾与两家金融机构发生纠纷。冯坚信自己受到这两家公司的不公平对待甚至是欺骗,因此他对这两个机构分别提出投诉。
Feng had disputes with two financial institutions that involved trading of 550 Elan Corp. shares. Maintaining that he was treated unfairly or was even cheated by both companies, Feng filed complaints against the two institutions.
A disgruntled customer
2010年4月,冯通过其汇丰银行的免税储蓄账户(TFSA)购买了550 股Elan Corp的股票。两年后,他通过书面要求银行将股票转出到另一家经纪公司PID(化名)。但是由于其申请表出现疑点,冯的转股指令未得以立即执行。
In April 2010, Feng bought 550 Elan Corp shares through his TFSA account with HSBC. Two days later, he instructed the bank, in writing, to transfer his shares to a brokerage firm, PID (assumed name). But due to confusion in the application form, the transfer request was delayed.
Mr. Feng changed his mind prior to his transfer instruction being processed. He called the bank, requesting to stop the transfer request. But his verbal request was not processed by the bank immediately. When the confusion in his transfer application was cleared in July 2010, the bank proceeded with transferring the shares out. 
Feng complained that HSBC failed to follow his most recent instructions – to stop transferring out shares. He phoned HSBC in July 2010, demanding an explanation. A customer service rep made an offer to allow Feng to sell his Elan shares upon receiving them back from the other firm.
但是冯似乎误解了银行的提案。他误以为银行为他出售Elan 股票的建议是在Elan股票仍在汇丰账户中的前提下而提出。而据当时Elan股票的价位,如果这一提议属实,汇丰则白白给冯提供了一笔$2700元的外财。
 But Feng seemed to have misunderstood the offer. He thought that the bank allowed him to sell the shares as if the shares were still being held by his HSBC account. Had this been a valid offer, it would be worth about $2700, given the share price at the time. 
Such an offer would be deemed as too good to be true. If the bank ever made any mistakes, the mistake was service related in nature which could be easily recovered by transferring the shares back. But Feng was even more enraged when the bank cleared up his misunderstanding over this verbal offer – it never meant to offer him 550 free shares. 
First complaint
But Feng’s grievances did not stop here. 
据冯称,在他的股票被转到PID后,该公司将这些股票出售,然后又用售股款购买了Triumph Ventures Corp之股票,而这些买卖交易都是在他不知情或未授权的情况下进行。
According to Feng, after his shares were transferred to the brokerage firm PID, it sold the shares and then used the proceeds to purchase Triumph Ventures Corp shares. All the transactions were carried out without his awareness or permission, according to Feng.
“Who made the decisions for me? Why did your firm place orders without my approval?” Feng wrote in an email to the brokerage agent.
Trading without client permission broke IIROC rules. Feng ‘s complaint against the firm resulted in two cheques being paid to his account, in the total of $6,000. The cheques were issued by the agent in PID who allegedly traded shares without Feng’s approval. He received the first payment of nearly $3000 on Feb. 17, and another payment of $3000 a few days later.  
Chinese News found that the agent has recently left PID. She had not returned the phone inquiries by press time.
Second complaint without merit
But Feng was still haunted by the dispute with HSBC. He argued that, had the bank stopped the transfer, he would have profited handsomely by selling the shares earlier, when Elan shares had peaked. 
Feng’s grievance led him to file a complaint with the Investment Industry Regulatory Organization of Canada (IIROC) against HSBC.
Feng’s argument can hardly be accepted by either the bank or its regulator. In early 2011, after several months’ investigation, IIROC found that Feng’s complaint had no merits and closed his file.
In a letter sent to Feng in Mar. 2011, IIROC indicated that the matter involved the level of service provided to Feng during the transfer of Feng’s account, but there was no evidence of a breach of IIROC rules. 
The letter also pointed out that Feng’s verbal request was made too late to stop transferring the shares out, as the transfer form had already been initiated by PID by that time.
Unsatisfied with the IIROC decision, Feng escalated his claim to the Small Claims Court. He sued HSBC, seeking damages of $8500.   
HSBC denied his allegations, stating that Feng did not sustain any alleged damages, nor was he treated unfairly or cheated by the bank.
Feng is still clinging to his hope that the court will award his damages. But he may also have to brace for a different court decision -- instead of winning a judgment, he might be ordered by the court to pay for defendant’s legal costs.



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