(January 31 – 17:50 ET) – The Department of Finance is proposing the creation of a Financial Consumer Agency, and plans to tap banks and insurance companies to fund it.

The creation of the agency was originally put forward in the federal governments’s financial services reform package last summer. The Liberals plan to reintroduce the legislation this session.

Finance proposes that a government agency to be called the Financial Consumer Agency of Canada, be established under the direction of a commissioner. The commissioner would be appointed by the Governor in Council, and charged with supervising financial institutions to determine whether they are in compliance with their legislative consumer protection obligations.

The commissioner would promote the implementation of consumer protecting policies at financial institutions, and monitor the implementation of voluntary, publicly available codes of conduct.

As well, the agency would promote consumer awareness of the obligations of financial institutions on consumer protection, and fostering co-operation between the government, financial institutions and consumer and other organizations.

Finance is proposing that the FCA be funded by assessments on banks, authorized foreign banks, federally regulated trust companies and insurers, retail associations, and Green Shield Canada. The Governor in Council will be authorized to make rules governing those assessments.

Although the commissioner would be required to make assessments at the beginning of each year, it would also be able to levy interim assessments. The assessments will be considered final, conclusive and binding on the financial institution against which it is made. Finance says interest may be charged on unpaid amounts at the rate payable by the Minister of National Revenue on tax refunds plus 2%.
-IE Staff