BACKGROUND (See Action Letter below)

The bank mergers proposed in 1998 were stopped, but TD Bank was allowed to take over Canada Trust in February 2000, banks and other financial institutions continue to provide poor service to many Canadians, and bank mergers will likely be proposd in the future.

The federal government released a policy paper on financial services at the end of June 1999, and introduced draft legislation in the form of Bill C-38 on June 13, 2000, but Bill C-38 was derailed by the fall 2000 federal election.

Bill C-38 was re-introduced as Bill C-8 in February 2001, and was passed by Parliament in June 2001.

Bill C-8 contained some good measures, but left some key gaps in bank regulation (For details, see Comparison Between Bill C-8 and CCRC Recommendations).

In late 2006, the federal government introduced Bill C-37 (which passed in April 2007) but it contained a couple of ineffective measures that only slightly increase bank accountability in Canada (For details, see the CCRC's Analysis of Bill C-37).

The federal government has an ongoing review of the Bank Act -- so please let the government know you want Canada's banking law strengthened to prevent and penalize gouging and abuse of customers, businesses and communities by Canada's big banks.

In addition, the federal government has an ongoing public consultation process on the review process for bank mergers, and plans to finalize review guidelines in 2008.

Below are suggestions for pushing the government to close these gaps in your letter to Prime Minister Stephen Harper, Finance Minister Jim Flaherty, opposition party leaders, and your MP. Also, it is very helpful if you include examples in your letter of poor service you have received from banks or other financial institutions.

Dear Prime Minister Harper / Finance Minister Flaherty / Opposition Party leader / Your MP:

1. Facilitate the creation of a Financial Consumer Organization (FCO) to help consumers (as recommended by the Task Force on the Future of the Canadian Financial Services Sector and a House and Senate committee in 1998), and an Individual Investor Organization (IIO), by requiring banks and other financial institutions to enclose an FCO information pamphlet in their mailings to customers, and an IIO information pamphlet in their mailings to shareholders, with both pamphlets inviting people to join the watchdog groups at a nominal annual membership fee;
2. Require banks and trust companies to provide detailed information on loans, investments and services to customers, as required in the U.S (to track whether banks are fairly meeting the needs of individuals and businesses on a community-by-community level and, as in the U.S., to require corrective action if banks are not fairly meeting customer needs);
3. Empower the Competition Bureau and Financial Consumer Agency of Canada (FCAC) to conduct an audit of profits from service charges and credit card interest rates, and reduction in competition community-by-community across Canada, and savings from closing branches and firing tellers, over the past 15 years, and require banks to cut charges and open branches if past profits were excessive; 
4. Prohibit any future service charge or credit card interest rate increases if the bank can't prove the increase is justified;
5. Require banks and trust companies to disclose the profit/loss record for any branch proposed to be closed, to allow for a full review of the reasons for the closure;
6. Require banks and trust companies to prove that they have a fair, responsible and very good service, lending and investment record every year for the past 10 years as a mandatory condition for any financial institution bidding on federal government contracts;
7. Require the Financial Consumer Agency of Canada Commissioner to disclose the name of the financial institution and the terms of settlement whenever the Commissioner finds that an institution has violated the law (currently, the Commissioner can only disclose the name of the institution if the Commissioner prosecutes the institution), and change the complaint process so that consumers can complain to the Ombudsman for Banking Services directly at any time without having to go first to their bank's ombudsman;
8. Give customers access to the money they deposit by cheque as soon as the cheque clears, and;
9. Given that each of the big banks makes billions of dollars each year, increase the maximum penalty for violating the Bank Act from the too-low amount of $200,000 to the more effective penalty of $50 million.

And please do not let Canada's banks take over any other financial institution, or merge together, before you have set up the Financial Consumer Organization and Individual Investor Organization, and the strict bank lending, investment and service disclosure and evaluation system outlined above.

Please let me know what steps you are taking to introduce bills to close these bank accountability loopholes, to pledging in your party's election platform to close these loopholes.

My vote in the next election will very much depend on your response.  I look forward to hearing from you.

Sincerely,

(put your name, postal address and email address here, and send the letter to the addresses below)

********

DETAILS about the 9 bank accountability proposals made in the above letter:

1. The Task Force on the Future of the Canadian Financial Services Sector recommended the creation of the Financial Consumer Organization (FCO) in its September 1998 Report (See Recommendation #56(b) on page 208 of the Report), and the House of Commons Finance Committee and Senate Banking, Trade and Commerce Committee endorsed the recommendation in their December 1998 reports.  To see a summary of the FCO proposal (on the Democracy Watch website), click here.  To see the CCRC's full position paper describing the FCO proposal in detail, click here, and for more details, click here).  The creation of the Individual Investor Organization (IIO) was recommended by an Ontario parliamentary committee in September 2006.  To see a summary of the IIO proposal, click here.
2. To see details about the U.S. Community Reinvestment Act (CRA), click here -- To see details about the $4.5 trillion in reinvestments that have resulted from the CRA since 1977 (in a PDF-format document), click here); and prohibit bank takeovers and mergers (such as TD Bank's takeover of Canada Trust -- To see the CCRC's review of the TD Bank takeover of Canada Trust, click here) if the disclosed information shows that they do not serve all customers well -- To see the CCRC's position paper describing how this bank accountability system should work, click here;
3. To see details about the proposal to audit on cutting of banking branches and services, and prices and interest rate hikes, over the past 15 years in Canada, click here;
4. To see details about the proposal to prohibit any price or interest rate increases by the banks unless they can justify the increase, click here;
5. To see details about the proposal to require banks and trust companies to disclose the profit/loss record for any branch proposed to be closed, click here;
6. To see the CCRC's position paper describing how each bank's lending, investment and service record could be evaluated regularly, click here; and to see the CCRC's position paper concerning evaluating bank mergers and takeovers and competition issues, click here;
7. To see details about the flawed powers of the Financial Consumer Agency of Canada Commissioner to disclose the name of financial institution's that break the law, click here and view subsection II(c);
8. Bill C-37 (which passed in April 2007) only reduces the cheque hold period from the usual 10 days to 4-7 days, even though 98 percent of cheques clear in one day, and;
9. Bill C-37 (which passed in April 2007) increased the maximum penalty from $100,000 to only $200,000, a meaningless penalty for Canada's big banks which each make $15 billion in revenue each year.

THE ADDRESSES
Please send your letter for free (no postage necessary), to Prime Minister Stephen Harper, Finance Minister Jim Flaherty, and also Liberal Party Leader Michael Ignatieff, NDP Leader Jack Layton, and Bloc Québecois Leader Gilles Duceppe, and your own MP
all at the following address (NO POSTAGE NEEDED):

House of Commons
Ottawa, Canada
K1A 0A6

OR send your letter by email to all the federal party leaders, the Finance Minister, and key MPs and Senators at:
pm@pm.gc.ca, harper.s@parl.gc.ca, Ignatieff.M@parl.gc.ca, jack@fed.ndp.ca, ducepg@parl.gc.ca, leader@greenparty.ca, Flaherty.J@parl.gc.ca, fina@parl.gc.ca, banking_banques@sen.parl.gc.ca

You can also fax your letter to Stephen Harper at fax: (613) 941-6900 or Jim Flaherty at fax: (613) 995-5176.

NOTE: Email letters are not read as thoroughly, and are not as influential over policy-makers, as hand-written letters sent by mail or faxed. So please, if you have the time, write a letter and send it by mail or fax to these two ministers.

OR send your letter by fax or email individually to:
Prime Minister and Conservative Party Leader Stephen Harper
Fax: 613-941-6900
Email: <pm@pm.gc.ca>
Email: <harper.s@parl.gc.ca>

Liberal Leader Michael Ignatieff
Fax: 613-947-0310
Email: <Ignatieff.M@parl.gc.ca>

NDP Leader Jack Layton
Fax: 613-230-9950
Email: <jack@fed.ndp.ca>

Bloc Québecois Leader Gilles Duceppe
Fax: 613-954-2121 or 514-522-9899
Email: <ducepg@parl.gc.ca>

If you have time, also write to the House of Commons Finance Committee at: 180 Wellington St. Roon 603, Ottawa, Ontario K1A 0A6; the fax number is (613) 996-1626 and the email address is fina@parl.gc.ca

Also if you have time, write to the Senate Banking Committee at: The Senate, Ottawa, Ontario K1A 0A6, Fax: all MPs and Ministers is House of Commons, Ottawa, Ontario K1A 0A4; the fax number is (613) 947-2104 and the email address is banking_banques@sen.parl.gc.ca