Securities Office
- Do I have a Complaint?
- Rights and Responsibilities
- What Can I Do If I have a Problem?
- Addressing Issues With Your Firm
- Tips For Effective Complaining
- Contacting the Regulators
- Other Options
- How to Avoid Problems
- Contact Information for Organizations Mentioned in this Guide
Return to Investor Information
Investments may not always turn out the way we want them to.
Their values can fluctuate and cause you to lose money. This isn't necessarily anyone's fault. This is simply a reality of the investment markets, and it's the responsibility of you and your adviser to ensure that the investments you choose are suitable for your risk tolerance and personal circumstances.
However, as with any service, mistakes can happen in the investment industry. These can range from minor errors to more serious mishaps. In most cases, the firm you deal with will act quickly to fix such problems. At other times, the matter may be more difficult to resolve or the firm may dispute that a mistake has occurred.
If you find yourself involved in one of these situations, you will want to put matters right as quickly as possible. This guide explains how to do that.
Occasionally, you might lose money investing because the person or firm you deal with has acted improperly; for example if an adviser:
- Recommends an investment that is unsuitable for the client.
- Makes an investment without first getting the client's approval.
- Generates excessive commissions by encouraging clients to buy and sell investments frequently without a sound reason to do so.
Your rights and responsibilities may depend on several federal and territorial laws and may be laid out in your agreements or contracts with the firm.
Before contacting the institution in question, it may be useful to review your contract/agreement to ensure that you understand the terms and conditions e.g. account agreement, loan contract, lease agreement, card holder agreement, etc.
For your best chance at success:
- First, find out about your legal rights. Are there any laws or regulations that can help you?
You may first want to visit the Canadian Consumer Information Gateway for specific information on the nature of your complaint.
What Can I Do if I have a Problem?
Decide what you want to achieve.
You may be seeking an explanation, a correction of an error, an apology or compensation for money you have lost. In more serious cases, you may fear that someone has broken the rules.
Once you begin the complaint process, it is very important that you document all of the steps you take towards resolution, including telephone conversations, e-mails and faxes. Keep a log of the times and dates of phone calls, who you spoke with and what was discussed. Communicate in writing as much as possible and keep copies of all correspondence.
First, raise your concern with the person you deal with at the firm.
Most problems are solved quickly by contacting the person who sold you the product or provided you with a
service. They are familiar with your account and will be able to clear up any misunderstanding.
- Your first option is to take your concern higher up through the firm's complaint process. This might mean you have to speak to several different people at the firm.
Follow this chart for steps you can take:
Addressing Issues With Your Firm
Ask for details about the firm's formal complaint process.
Going first to the firm that handles your account makes sense. They have all the records of what happened and are in the best position to put matters right.
Step 1.
Contact the person who is handling your account. If you are dealing with a discount or online brokerage firm,
call the customer service department.
- Clearly explain what your problem is. Have handy any reference numbers that you might need,
such as your account number and any transaction numbers.
- Make notes of your conversation, who you spoke to and the time of the call. You may need to refer to these notes later if you decide to
take legal action or file a formal complaint with the firm and the regulators.
- The person you speak to may immediately agree that you have a valid complaint, or they may be able to clear up any misunderstanding. If the firm agrees to fix a problem, write a letter to the individual you spoke to confirming what you discussed. Send a copy of the letter to the firm's.
Step 2.
If a personal visit or telephone call does not produce the satisfactory results, write a letter to someone higher
up such as a Manager or Compliance Officer. The firm's head office can provide the mailing address for this
person. If you need help to get this information, you may contact the Northwest Territories Securities Office. To compose an effective letter, provide all of the details of the problem and your
efforts to resolve it. Ask for action.
Your letter should include your name, address, telephone number; the name and type of product you bought, date you bought and price you paid; an outline of the problems and your attempts to solve them; what you what the firm to do about your problem and copies of other documents (keep the originals for yourself).
Once you have completed your letter, save it to disk or to your hard drive. Print it and send it via registered mail to the Manager or Compliance Officer along with you supporting documents.
- Letters to the Compliance Department should outline your specific concerns and include copies of any documents or statements that support
your position. Keep the letter factual and business-like.
- The firm should acknowledge your letter shortly after they receive it. The length of time required to review your matter depends on the workload of the Compliance Officer it is assigned to and the complexity of your situation. While most firms will estimate the time required for resolution, the estimates may vary depending on the Officer's findings.
Step 3.
If the firm completes its review and you remain unsatisfied with their conclusions, you can follow one of several approaches, depending on the outcome you
expect.
If you are seeking financial compensation, you can pursue the matter in Small Claims Court, through Binding Arbitration, in Civil Court, or through the Ombudsman for Banking Services and Investments.
If you are concerned that the adviser's or firm's conduct breached Securities Law or any Rule, Regulation or By-Law of a Self Regulatory Organization (SRO), you can file a complaint for a Regulatory Review and possible disciplinary proceedings with the appropriate regulator.
- If a firm is a member of either the Investment Dealers Association (IDA) or Mutual Fund Dealers
Association (MFDA) you may submit your complaint directly to them. Both organizations have a process for reviewing
complaints as well as the ability to initiate an enforcement action should it be warranted. You may contact these
organizations to confirm whether your adviser or dealer is a member.
- If you are not satisfied with the conclusions of the SRO review, you may then request the Northwest Territories Securities Office review the way your complaint was handled.
Provide a written description of your problem, when it happened and the names of those involved. Also, give us your name, address, and telephone number. Send this information to:
Office of the Registrar of Securities
1st Floor, Stuart M. Hodgson Building
PO Box 1320
Yellowknife, NWT X1A 2L9
Phone: (867) 920-3318
Fax: (867) 873-0243
for further information regarding the complaint process. We keep complaints confidential, but we must be able to contact you for more information. We cannot act on complaints that are made anonymously or that are not in writing.
Securities Office staff will review your complaint to determine whether there has been a breach of Northwest Territories securities laws. They will investigate the alleged misconduct and may recommend the imposition of administrative sanctions. Some complaints may be referred to other agencies where appropriate.
We will advise you of the final outcome of our investigation into you complaint. However, it may take several months, and perhaps even longer, to complete the review and investigation.
While the Securities Office does attempt to assist members of the public in reaching a satisfactory resolution to their concerns, we are a regulatory agency and we cannot:
- order that money be refunded or contracts be cancelled
- award damages or costs
- provide any legal advice or recommend a lawyer
It's often best to explain the problem in writing.
When you first contact the firm with a problem, you can do so on the telephone. But remember to take notes of your conversation, who you spoke to, and the date and time of the call. This is a record of your complaint and you should store it in a safe place.
Even if a single call is all it takes to fix the issue, you should probably follow up the phone conversation with a letter confirming what you have agreed to. Copy the letter to the branch manager.
If the initial phone call doesn't produce results, you will need to put your concerns in writing. Your letter needs to clearly explain what the issue is and how you expect the firm to fix things. Always keep a copy of each letter you write for your own files.
- It's best to type the letter or write it in dark ink. This will make for better quality photocopies.
- Write "Complaint" at the top of your letter so that the person receiving it knows immediately what it is about.
- Include any account numbers, product details or transaction numbers.
- Be Clear. Explain the problem in the order that the events occurred. Know your facts- preferably by keeping a file with all the necessary documents, including your cancelled cheques, contracts and any letters you have written to or received from the firm - and use them to ask for what you want.
- Enclose copies of any relevant documents, such as account statements, trade confirmations and any letters you've written or received about the issue. Never send the originals of any documents in case they get lost.
- Do not be afraid to complain. Good businesses will be pleased to correct any mistake on their part. They know that customer goodwill is the best form of advertising.
- DO NOT PROCRASTINATE- If there is a problem, it is important that you contact the firm quickly so that you do not lose the right to get your money back, as well as damages in some cases.
- Talk to the right people, in the right order. Give each person enough time to resolve your complaint. Start with the sales person, then move on to the customer service office or the manager. If that still does not work, contact the firm's head office. Note the names of people you talk to, as well as the dates, times and outcomes of the conversations.
- Keep the tone of your letter polite and straightforward. You'll get a better, and maybe quicker result if you explain the problem and ask for resolution without resorting to anger or threats.
Our role is to administer and enforce the Northwest Territories' securities rules.
If you are unable to resolve your problem with the firm, you can call the Securities Office. The Securities Office staff will assist you wherever possible or suggest a suitable course of action for you.
Where there is evidence that someone may have violated the Securities Act, we will investigate.
If you feel that someone has acted improperly and you are unable to resolve the issue with the firm, you should prepare a formal complaint to us in writing.
If the problem involves a firm that is a member of the Investment Dealers Association (IDA), send your complaint directly to the IDA's Central Complaint Bureau at Suite 1600, 121 King Street West, Toronto, ON M5H 3T9 or by fax at (416) 364-0753.
If the problem involves a firm that is a member of the Mutual Fund Dealers Association (MFDA), send your complaint directly to the Complaints Department, Enforcement Branch, Mutual Fund Dealers Association of Canada, Ste 1600, 121 King Street West, Toronto, ON M5H 3T9 or by fax at (416) 943-1218.
If your complaint involves a trading-related matter involving a company listed on either the Toronto Stock Exchange (TSX) or the Venture Exchange (TSX VE), you may mail your complaint to the Corporate Compliance Officer, Market Surveillance, Market Regulation Services Inc., 145 King Street West, Ste 900, Toronto, ON M5H 1J8.
Situations where you might want to file a complaint with the TSX include:
- Disclosure practices of TSX listed companies
- Poor execution of an order
- Possible violations of trading rules by any market participant
As self-regulatory organizations (SROs), the IDA, MFDA and TSX regulate the standards of practice and business conduct of their members, in accordance with their by-laws, rules, regulations and policies. However, provincial and territorial securities commissions and regulators oversee the work they do.
When you are not sure if the firm is an IDA, MFDA or TSX member, you can still file your complaint with us. We will let you know if we are going to send it to the IDA, MFDA or TSX to review.
Should your complaint be against a firm that is not a member of an SRO, you may send your complaint directly to the Securities Office. Please note that neither the Securities Office nor the SROs have the ability to unwind transactions or order financial compensation.
After exploring every avenue with the firm, your only remaining option to seek compensation is to take legal action. Exactly what legal steps you take will depend in how much money you want to get back, and whether the firm involved is part of an arbitration scheme.
It is a good idea to consult with a qualified securities lawyer before you decide on which legal option to pursue. A lawyer can also help you define the key legal issues of your case and give you an opinion on your case.
Option 1: Small Claims Court
Small claims court gives you a simple and less expensive way to sue for compensation and damages of up to $10,000. However, you will have to pay a fee to file a claim, and later there may be other costs to you for such things as serving orders, payments to witnesses and travelling expenses. For information on how to proceed contact the Small Claims Court, or Territorial Court, nearest you.
Most people represent themselves in small claims court. If your problem is complex you may want to bring a lawyer to help you. If you win your case, the judge may order that the firm compensate you for your legal costs up to certain limits.
Option 2: Binding Arbitration
If the firm that you have the disagreement with is a member of the IDA, you have the option of taking your case to a hearing by an independent arbitrator.
When you choose this route, you agree to treat the arbitrator's decision as final. You give up the right to appeal the case in the courts if you are not satisfied with the judgment.
For arbitration to occur:
- Your claim must generally be between $6,000 and $100,000, although the amount can be outside this range if both you and the firm agree.
- You must have tried to resolve the dispute with
the firm.
- The problem must have originated after June 30, 1998.
Arbitration is usually less time-consuming and cheaper than taking your case to civil court. You can choose to present your case yourself or hire a lawyer to help you. The cost of the arbitration hearing is shared between you and the firm you are suing. The arbitrator may also order that whoever loses the case pay all the costs of the hearing.
For more information on the arbitration program you can visit the IDA's website, www.ida.ca or contact them directly.
Option 3: Civil Court
If you are trying to recover a large sum of money, then your most likely option is to take your case to civil court.
You can't take a case to civil court without a lawyer
If you need the name of a securities lawyer, contact the Law Society of the Northwest Territories.
Option 4: The Ombudsman for Banking Services and Investments
The Ombudsman's office is an industry-funded service that will receive and review investor complaints. Once the firm has completed its review, you may submit a complaint to the Ombudsman if you are complaining about a bank, member firm of the IDA, MFDA or Investment Funds Institute of Canada and most federally regulated trust and loan companies.
The Ombudsman will attempt to resolve complaints seeking compensation to a maximum of $350,000. After reviewing the matter the Ombudsman may recommend compensation; however the Ombudsman's recommendation is not binding upon the parties.
Always ask questions about anything you don't understand.
Getting into a dispute with an investment firm is not fun for anyone. But there are things you can do to lessen the chances of finding yourself in that situation.
Taking steps to avoid problems can also help you be prepared if a problem does arise.
- Read the fine print
Read every document your investment firm provides you, including account agreements, mutual fund and other prospectuses, account statements and trade confirmations. This will help prevent misunderstandings over fees and service standards. Be especially careful about signing agreements that say you have received a prospectus or other disclosure document when you haven't been given one.
- Keep records
File all documents about your account in a safe place after reading them. Ask your adviser for an updated copy of your investment profile at least once a year. Take notes of each conversation you have with your adviser or dealer and file these away, as well.
- Ask questions
Be inquisitive and show interest in your investments. Ask your adviser to explain why he or she thinks a particular investment is suitable for you. Ask how various fees, commissions and other charges may have an impact on your investments.
- Think things over
Don't make a quick decision because someone tells you a delay could mean you will miss out on a rare opportunity. A good quality long-term investment should be as attractive tomorrow as it is today. Never sign an agreement or other document until you have taken it home to read.
- Keep your adviser informed
Make sure your adviser knows about changes in your life or your feelings toward risk. These can significantly change the advice your adviser provides you. Keep your adviser informed if your income, your health or your family situation changes.
Remember:
- Never sign a blank document
- Never invest in anything you don't understand
- Any document you sign may be used as evidence should problems develop in the future
Keep a record of all dealing
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Get into the habit of keeping notes of all your conversations with your adviser.
Contact Information for Organizations Mentioned in this Guide
Ombudsman for Banking Services & Investments
P.O. Box 896
Station Adelaide
Toronto, ON M5C 2K3
Tel: 1 (888) 451-4519 or (416) 287-2877
Fax: 1 (888) 422-2865 or (416) 225-4722
Website: www.obsi.ca
Email: ombudsman@obsi.ca
IDA Central Complaints Bureau
121 King Street West, Suite 1600
Toronto, ON M5H 3T9
Tel: (416) 364-6133
Fax: (416) 364-0753
Website: www.ida.ca
IDA Arbitration Program
Arbitration Dispute Resolution (ADR) Chambers
c/o The Honourable John B. Webber, Q.C.
48 Yonge Street, Suite 1100
Toronto, ON M5E 1G6
Tel: (416) 362-8555 or 1(800) 856-5154
Fax: (416) 362-8825
Email: adr@adrchambers.com
Website: www.adrchambers.com
The Mutual Fund Dealers Association (MFDA)
Complaints Department, Enforcement Branch
Mutual Fund Dealers Association of Canada
Suite 1600, 121 King Street West
Toronto, ON M5H 3T9
Fax: (416) 943-1218
Small Claims Court & Civil Court
See the blue pages in your local telephone directory or
contact
Market Regulation Services Inc.
Corporate Compliance Officer,
Market Surveillance
145 King Street West, 9th Floor
Toronto, ON M5H 1J8
Tel: (416) 646-7299
Website: www.regulationservices.com
Email: inquiries@regulationservices.com
Law Society of the Northwest Territories
Main Floor; 5004 - 50th Avenue
P.O. Box 1298, Yellowknife, NT X1A 2N9
Tel: (867) 873-3828
Fax: (867) 873-6344
Email: LSNT@TheEdge.ca
Website: www.lawsociety.nt.ca
Centre for the Financial Services OmbudsNetwork (CFSON)
1 Queen Street East
Suite 1605
Toronto, ON M5C 2X9
Tel: (416) 777-2043 or 1 (866) 538-3766
Fax: (416) 777-9716
Email: info@cfson-crcsf.ca
Website: www.cfson-crcsf.ca
