Federal regulators say the Bank of Montreal overcharged more than 101,000 customers for years, forcing the bank to pay $3.6 million in compensation after managers ignored hundreds of complaints about fees that should have been waived or discounted.Blacklock's Reporter says the Financial Consumer Agency of Canada disclosed Monday that its investigation, completed in 2025, found BMO improperly charged monthly plan fees to 101,091 depositors despite marketing discounted or free accounts to certain groups. The agency said the bank failed to act even after receiving more than 500 customer complaints.“The total penalty amount of $3,629,536 reflects, among other criteria, the degree of the bank’s negligence in failing to implement adequate controls and effective monitoring measures,” the agency wrote, noting repeated warnings were ignored.Investigators found BMO breached the Bank Act by failing to waive fees promised to immigrants, postsecondary students, indigenous depositors and other eligible customers. Many were enrolled in discounted programs but were still charged monthly fees..According to the regulator, the bank refunded affected customers $3,027,956, while another $601,570 that could not be returned directly was paid out as a charitable donation.The agency said BMO committed two violations of its disclosure obligations under the Bank Act. From 2010 to 2024, customers were given inaccurate information about when fees would be waived, and between 2022 and 2024 the bank failed to clearly disclose when monthly plan fees would begin.Customers who applied in-branch for discounted programs were provided written confirmations showing incorrect start dates for fee waivers, the commissioner’s ruling said, resulting in improper charges.The $3.6 million penalty is the largest publicly known sanction imposed on the Bank of Montreal. .In 2020, the bank was fined $500,000 for breaching negative option billing rules on credit cards, and in 2019 paid $200,000 for failing to clearly disclose terms for home equity lines of credit.The agency only began publicly naming banks that violate consumer protection laws after Parliament passed Bill C-86 in 2018. Before then, enforcement actions were typically kept confidential.“The Agency should strive to protect the rights and interests of consumers,” Eleanor Ryan, then director general of financial institutions at the Department of Finance, told MPs during committee hearings on the legislation. The law now requires public disclosure whenever a violation and penalty are imposed.
