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| Agence de la consommation en matière financière du Canada | |
| File:FCAC English avatar.jpgAvatar of the Financial Consumer Agency of Canada for use in social media | |
| Agency overview | |
|---|---|
| Formed | 2001 |
| Jurisdiction | Government of Canada |
| Headquarters | Ottawa, Ontario |
| Employees | 54 |
| Annual budget | $10.7M (CAD) |
| Agency executive |
|
| Website | www.fcac-acfc.gc.ca |
The Financial Consumer Agency of Canada (FCAC) is an independent government agency of the Government of Canada, the dual mandate of which is to ensure that federally regulated financial entities comply with legislation and industry commitments intended to protect consumers; and to deliver information about financial products, services and issues to consumers and help them build financial skills.
The Agency was established in 2001 by the federal government to strengthen oversight of consumer issues and expand consumer education in the financial sector. In July 2010, FCAC was also tasked with the oversight of payment card network operators and their commercial practices.
Mandate
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FCAC has a dual mandate, set out in the Financial Consumer Agency of Canada Act. Broadly, these two main elements are:
- ensuring and enforcing compliance by the financial sector with federal legislation and regulations, as well as voluntary codes of conduct and public commitments
- promoting greater financial literacy by informing consumers about their rights and responsibilities when dealing with financial entities and payment card network operators.
Under its compliance mandate, FCAC is responsible for:
- ensuring that the market conduct of federally regulated financial entities complies with federal legislation and regulations
- promoting the adoption of policies and procedures designed to implement legislation, regulation, voluntary codes of conduct and public commitments by federally regulated financial entities
- monitoring federally regulated financial entities’ compliance with voluntary codes of conduct and their own public commitments.
Under financial literacy, FCAC is responsible for:
- informing consumers about their rights and responsibilities when dealing with financial entities and about the obligations of payment card network operators to consumers and merchants
- providing timely and objective information and tools to help consumers understand, and shop for, a variety of financial products and services
- monitoring and evaluating trends and emerging issues that may have an impact on consumers of financial products and services.
Scope
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FCAC monitors and supervises financial institutions and external complaints bodies that are regulated under federal legislation. These entities include all banks and federally incorporated or registered insurance, trust and loan companies, retail associations, federal credit unions and external complaints bodies.
FCAC does not regulate foreign bank representative offices, fraternal benefit societies or cooperative credit associations.
FCAC also supervises payment card network operators to determine whether they are in compliance with the provisions of the Payment Card Networks Act.
A complete list of federally regulated financial institutions is available on the website of the Office of the Superintendent of Financial Institutions.
As a regulatory agency, FCAC can exercise its enforcement powers to ensure that federally regulated financial entities comply with the consumer provisions of the various federal acts relating to financial services, including:
- the Bank Act
- the Insurance Companies Act
- the Trust and Loan Companies Act
- the Co-operative Credit Associations Act
- the Green Shield Canada Act
- the Payment Card Networks Act
- the Financial Consumer Agency of Canada Act.
In cases of contravention or non-compliance with legislation, FCAC notifies the federally regulated financial entity of a violation. Depending on the severity and frequency of the problem, the Agency may also:
- seek a commitment from the financial entity to remedy the issue within a short time
- impose a monetary penalty
- impose criminal sanctions
- take other actions as necessary.
History
In December 1996, the Government of Canada launched the Task Force on the Future of the Canadian Financial Services Sector, one of several initiatives following extensive debate and consultation on reform of the financial sector.
In September 1998, the Task Force presented the federal government with its report, Change, Challenge, Opportunity (known as the MacKay Report). One of the Task Force’s findings was that “the current framework for consumer protection is not as effective as it should be in reducing the information and power imbalance between institutions and consumers.” Two parliamentary committees reviewed the Task Force Report, held public consultations across the country and presented their own recommendations.
A broad consensus on ways to improve the financial sector emerged through this process. In June 1999, the government released a policy paper, Reforming Canada’s Financial Services Sector: A Framework for the Future, containing 57 reform measures. Among them was a proposal to create a financial consumer agency to oversee consumer interests and improve consumer protection. Legislation to implement the reform package was passed on June 14, 2001.
The Financial Consumer Agency of Canada opened its doors in 2001 under the Financial Consumer Agency of Canada Act, to protect and inform consumers about financial services.
The first commissioner (2001–2006) was William G. Knight, a former credit union executive and New Democratic Party Member of Parliament from Saskatchewan. The current Commissioner is Ursula Menke.
In its first year, FCAC established a website and a call centre for consumers to make complaints and ask questions about their rights and responsibilities regarding financial products and services. It also produced its first publications, Credit Cards and You and the Consumer’s Guide to Basic Banking Services.
In 2002, FCAC produced its compliance framework, which established the standards and norms against which the Agency determined whether federally regulated financial institutions were compliant with all applicable legislation and regulations. The Agency also completed its first annual examination of the consumer practices of all federally regulated financial institutions.
In 2003, FCAC hosted the first International Forum on Financial Consumer Education and Protection, in Ottawa.
2003 was also the year the Agency began publishing all the Commissioner’s Decisions online, and saw the publication of the first Commissioner’s Decision to consider plain-language consumer provisions. That year, it completed two industry reviews: on the disclosure of credit card interest rates on applications forms; and on internal complaint-handling procedures.
In 2004, a new voluntary Code of Conduct for the Debit Card Industry came into use, and became incorporated into FCAC’s standards. That year, FCAC noticed a rising trend of financial fraud being committed against Canadian financial consumers and assigned more resources to informing Canadians about how to identify fraud and protect themselves against scams.
FCAC also added its first Mortgage Calculator to its website, allowing consumers to enter their own details to determine what kind of mortgage they could qualify for, and the monthly payments.
The following year, FCAC added a complaint-handling database to its website and began publishing Consumer Alerts to warn consumers about emerging trends like phishing, a form of fraud.
In 2005, FCAC issued a Commissioner’s Decision stating that financial institutions must make equal, full disclosure to all borrowers of a loan, including co-borrowers.
That year, FCAC created an online tool for consumers to compare and select credit cards. FCAC released its most popular publication, Understanding Your Credit Report and Credit Score.
In June 2005, along with Social and Enterprise Development Innovations (SEDI) and Public Research Initiative, FCAC co-hosted an international conference entitled Canadians and Their Money: A National Symposium on Financial Capability.
In 2006, FCAC partnered with MasterCard and the non-profit group Éducaloi to create a sample credit card application from written in clear, simple language.
FCAC’s first Commissioner, Bill Knight, retired in 2006. Ursula Menke became the second Commissioner in early 2007. That year, the Government of Canada provided FCAC with an additional $3 million for the creation of the Financial Literacy Initiative.
In 2008, Lucie Tedesco joined the Agency as Deputy Commissioner. FCAC produced two major initiatives in partnership with other organizations. With the British Columbia Securities Commission (BCSC), the Agency developed and launched The City: A Financial Life Skills Resource. In partnership with SEDI and the Joint Forum of Financial Market Regulators, FCAC hosted Reaching Higher: Canadian Conference on Financial Literacy in Ottawa. 2008 was also the year FCAC began publishing the Commissioner’s Decisions in their full text, barring minimal edits to protect confidential information.
In 2009, new federal legislation gave FCAC oversight over payment card network operators. Under its financial literacy mandate, FCAC designed and launched Financial Basics, a series of financial literacy workshops aimed at young adults, in partnership with Ontario’s Investor Education Fund (IEF), George Brown College in Toronto, and financial author Ellen Roseman. FCAC also developed the Clear Language and Presentation Principles and Guidelines for the financial industry.
FCAC’s Financial Literacy Team won a Public Service Award of Excellence for the previous year’s launch of The City in 2009.
On July 11, 2010, amendments to the Financial Consumer Agency of Canada Act further expanded FCAC’s role in four areas:
- 1. increased ability to do research, field testing and stakeholder engagement to provide information to the government on financial consumer trends and emerging issues
- 2. expanded consumer information role to cover all matters related to protecting consumers of financial products and services
- 3. responsibility for overseeing the Payment Card Networks Act (PCNA) and any related regulations
- 4. promoting public awareness of the PCNA and the Code of Conduct for the Credit and Debit Card Industry in Canada.
As a result of amendments to the Bank Act in 2010 which provided for federally regulated credit unions, FCAC became responsible for supervising and monitoring such credit unions’ compliance with applicable legislation and regulations.
In August of 2010, the Code of Conduct for the Credit and Debit Card Industry came into force. FCAC opened its new Research Branch as part of its expanded mandate.
In 2011, the Task Force on Financial Literacy released its recommendations. The Commissioner of FCAC also became the interim Chair to Financial Consumer Protection Network (FinCoNet) in May 2011.
November 2011 was the first Financial Literacy Month. FCAC, together with a group of community organizations called the Financial Literacy Action Group (FLAG), organized workshops and other events across Canada to promote financial literacy among consumers .
Organization
FCAC is headed by a Commissioner, appointed for a five-year term. The Commissioner reports annually to Parliament through the Minister of Finance, on the Agency's activities and on the performance of financial institutions in complying with consumer protection measures. The first commissioner (2001–2006) was William G. Knight, a former credit union executive and New Democratic Party (Canada) Member of Parliament from Saskatchewan.
Ursula Menke was appointed Commissioner on December 3, 2007 for a five-year term. On December 3, 2012, she was reappointed for a six-month term.
Ms. Menke received a Bachelor of Science and Bachelor of Civil Law degrees from McGill University. She also earned a teaching diploma from the University of Alberta. From 1977 to 1992, Ms. Menke held various positions in corporate and legal services with the Office of the Superintendent of Financial Institutions, in the private sector and with the Department of Finance Canada.
Ms. Menke served as Inspector General of the Canadian Security Intelligence Service, reporting to the Solicitor General, from 1992 to 1993.
In the private sector, Ms. Menke was Vice-President, Counsel and Corporate Secretary at the Metropolitan Life Insurance Company from 1993 to 1998.
From 1999 to 2002, Ms. Menke was Secretary General of the [[Canadian Radio-television and Telecommunications Commission; from 2002 to 2004, she was Deputy Commissioner of the Coast Guard.
From 2004 to 2005, Ms. Menke was Head of Coordination for Sponsorship Matters at the Privy Council Office, where she coordinated the federal government's activities on sponsorship issues, particularly for the Commission of Inquiry into the Sponsorship Program and Advertising Activities (Gomery Commission).
Compliance and enforcement
Under its compliance and enforcement mandate, the Agency investigates cases of non-compliance with consumer protection measures as set out in Canadian legislation. FCAC identifies potential cases using consumer complaints, as well as through the inquiries and investigations of its officers. The Agency's commissioner can impose a variety of penalties on institutions found to be in violation of consumer measures, including monetary penalties and public naming of the institution.
FCAC's Commissioner reports to Parliament annually with an assessment of federally regulated institutions' compliance with legislation.
Consumer education
Under its consumer education mandate, FCAC produces publications and resources related to understanding and managing personal finances and financial products and services.
FCAC’s website makes available to consumers more than 60 different online publications, tip sheets and other resources along with interactive tools that help consumers find the financial products and services that best suit their needs. FCAC’s publications and resources address the following topics:
- banking
- budgeting and money management
- payment options and money transfers
- savings and investments
- fraud
- consumers’ rights and responsibilities.
Financial literacy
FCAC offers different financial education programs aimed at a wide range of age groups.
The City is an educational resource for high school students to better prepare them to handle the financial realities of adulthood by learning financial life skills through in-class lessons or self-guided online modules. This educational resource was developed by FCAC in partnership with the British Columbia Securities Commission and is freely available on the Web. It presents characters at different life stages to demonstrate real-life financial challenges that most young people will face.
Financial Basics is a financial workshop developed for young adults. FCAC, the Investor Education Fund and financial author and journalist Ellen Roseman developed the workshop materials. Non-profit organizations, educational institutions or employers can order the materials to teach budgeting, saving, credit, investing, fraud prevention and financial planning. The materials are available in both English and French, and can be ordered free of charge online or by mail.
Your Financial Toolkit is a comprehensive 11-module learning program that provides basic information and tools to help adults manage their personal finances and gain the confidence they need to make better financial decisions. It was designed by FCAC, the Investor Education Fund (IEF) and l'Autorité des marchés financiers (AMF).
The workshop materials are available free of charge in both English and French, and include:
- Presenter’s Manual
- Participants’ Handbooks
- Presentation slides
- Workshop evaluation forms
- Promotional artwork.
Financial Literacy Month
November 2011 was the first Financial Literacy Month, organized by FCAC in partnership with the Financial Literacy Action Group, an umbrella organization of community and non-profit organizations.
In 2012, the Parliament of Canada declared November to be national Financial Literacy Month.
FLM 2012, the second Financial Literacy Month, featured over 260 events held by close to 60 different organizations in every province and in one territory in Canada. Community and volunteer groups, government agencies and private-sector organizations offered workshops, seminars and other activities to teach managing personal finances.
FLM 2012 also featured FCAC’s first video contest for young people. The Agency invited students aged 13 to 19 to submit a video of one to three minutes on the theme, “How I am saving for ....” The video had to end with the words: “Financial understanding: it just adds up.” Thirty-eight students submitted videos, and the Agency selected three winners. The eight finalists were all available for viewing on FCAC's YouTube channel; Canadians who viewed the videos then picked a “People’s Choice” winner.