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Ottawa, November 7, 1995 Banks to Appoint an Industry Ombudsman to Review Small Business ComplaintsFinance Minister Paul Martin and Industry Minister John Manley today announced that as a result of discussions with senior bank officials, Canada's major banks have agreed to appoint an industry ombudsman to strengthen procedures for handling complaints from small business. The industry ombudsman will serve as a final point of appeal of decisions rendered by a bank's internal ombudsman. The industry ombudsman, who will be empowered to investigate and make non-binding recommendations to resolve complaints, will not be a banker and will operate independently of the banks and the Canadian Bankers Association (CBA). "I believe that the establishment of the banks' ombudsman framework will result in a higher degree of impartiality, transparency and uniformity in bank handling of small business complaints. I am pleased with these latest bank initiatives to better serve a sector which is so vital to securing economic growth and job creation in Canada," Minister Martin said. "The Standing Committee on Industry and the Government have been pressing the banking community to improve the way Canadian banks deal with small and medium-sized businesses," said Minister Manley. "Today's announcement, combined with the CBA Code of Conduct, also shows that the banks have come a long way to respond to the recommendations of the Small Business Working Committee that called for a meaningful dispute resolution for businesses, " he added. The two-tiered ombudsman structure will supplement other important facets of the banks' complaint handling procedures for small business, including their codes of conduct and alternative dispute resolution systems. The major banks recently announced plans to each appoint a senior bank officer to act as an internal ombudsman for small business. (One bank has already had an internal small business ombudsman operating for about two years.) The primary function of the bank ombudsmen will be to investigate customer complaints relating to both credit issues and broader service issues. They will operate outside the banks' commercial lending operations and will report directly to their Chief Executive Officers. The office of the industry ombudsman will begin operating by April 1, 1996. Once established, the office will serve as an independent association. The association will have a board of directors with representatives from the banks as well as the small business community. Jurisdiction of the industry ombudsman will parallel that of the banks' small business ombudsmen, including authority to review complaints related to bank credit and services. In addition, the office of the industry ombudsman will publicly report industry-level as well as individual bank statistics on the handling of small business complaints on a quarterly basis. ___________________ Office of the Minister of Finance Office of the Minister of Industry |
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