Democracy Watch (DWatch) has called on the Trudeau Liberal Cabinet and Finance Minister Chrystia Freeland to keep all five of the Liberals’ 2021 election promises to increase bank accountability in Canada.The Liberals have stalled on three key bank accountability measures, each mentioned in Minister Freeland’s mandate letter.The first is to empower the Financial Consumer Agency of Canada (FCAC) to “review the prices charged by banks and impose changes if they are excessive” (including reviewing interest rates, as Australia did in 2017). Instead, the Liberal government is only reviewing one gouging bank fee and consulting on low-cost, small-value credit.The second measure is to require financial institutions to offer options to delay consumer debt payments when needed. So far Ottawa has only issued mortgage guidelines and a mortgage charter, which DWatch says is unenforceable.The third measure is to close the tax loopholes to prevent banks and other financial institutions from pretending to make their money in low-tax countries in order to lower the taxes they pay in Canada. The Liberals have not completed their review of such loopholes, let alone close them.Duff Conacher, co-founder of Democracy Watch said “the Trudeau Liberals spouted half-truths” in their last campaign, followed by “half-measures” this term.“Finance Minister Freeland continues to protect the big bank’s gouging profits and their executives’ excessive multi-million dollar salaries instead of making the changes needed to stop banks from gouging billions from their 30 million customers and to protect bank customers from discrimination and other abuses,” Conacher wrote in a press release.“Every dollar of excessive profit for the banks and every person and business the banks unjustifiably refuse to loan to, costs the Canadian economy because it means that the banks are overcharging for their essential services and loans and choking off job creation and spending.”Over 120,000 voters signed on to DWatch’s letter-writing campaign or Change.org petition calling for an end to bank gouging, discrimination and abuse. Some such changes were enacted in the US decades ago. They have a full list of bank accountability demands online.The organization says two bank accountability promises have been partially kept. One of these saw a temporary excess profits tax placed on banks and insurance companies that earn more than $1 billion a year (of 15%, but for one year only in 2022) and an increase in their annual tax rate of 1.5%.However, the Liberals promised they would impose a higher 3% increase in the annual rate. By comparison, England imposed a more than 8% tax hike on banks in 2011 and Australia increased its bank tax rate in 2017.Secondly, Ottawa will require all banks to use the Ombudsman for Banking Services and Investments (OBSI) as the complaint-appeal entity as of November 1, 2024. However, the Liberals broke their promise to give OBSI “the power to impose binding arbitration.”Canada’s big six banks reported annual profits totalling $58.3 billion in 2023 and record total profits of $61 billion in 2022, almost triple their 2010 profits. Conacher said this was “all reaped through gouging their customers with excessively high credit card and other credit interest rates and mutual fund and other banking fees.”Four of Canada’s big six banks are listed in Fortune’s Global 500 for 2023 (based on 2022 profits), and TD, RBC, Scotiabank and BMO were also in the top 35 most profitable financial institutions in the world in 2022. Meanwhile, two banks are among the five most profitable Canadian companies in the Global 500.Canada’s big six banks also paid their CEOs a total of $73.3 million in 2022 (an average of $12.2 million each, 55% higher than in 2008) and in 2023 handed out $21.2 billion total in bonuses to their employees.More information is available on DWatch’s Canada’s Big Banks Backgrounder.
Democracy Watch (DWatch) has called on the Trudeau Liberal Cabinet and Finance Minister Chrystia Freeland to keep all five of the Liberals’ 2021 election promises to increase bank accountability in Canada.The Liberals have stalled on three key bank accountability measures, each mentioned in Minister Freeland’s mandate letter.The first is to empower the Financial Consumer Agency of Canada (FCAC) to “review the prices charged by banks and impose changes if they are excessive” (including reviewing interest rates, as Australia did in 2017). Instead, the Liberal government is only reviewing one gouging bank fee and consulting on low-cost, small-value credit.The second measure is to require financial institutions to offer options to delay consumer debt payments when needed. So far Ottawa has only issued mortgage guidelines and a mortgage charter, which DWatch says is unenforceable.The third measure is to close the tax loopholes to prevent banks and other financial institutions from pretending to make their money in low-tax countries in order to lower the taxes they pay in Canada. The Liberals have not completed their review of such loopholes, let alone close them.Duff Conacher, co-founder of Democracy Watch said “the Trudeau Liberals spouted half-truths” in their last campaign, followed by “half-measures” this term.“Finance Minister Freeland continues to protect the big bank’s gouging profits and their executives’ excessive multi-million dollar salaries instead of making the changes needed to stop banks from gouging billions from their 30 million customers and to protect bank customers from discrimination and other abuses,” Conacher wrote in a press release.“Every dollar of excessive profit for the banks and every person and business the banks unjustifiably refuse to loan to, costs the Canadian economy because it means that the banks are overcharging for their essential services and loans and choking off job creation and spending.”Over 120,000 voters signed on to DWatch’s letter-writing campaign or Change.org petition calling for an end to bank gouging, discrimination and abuse. Some such changes were enacted in the US decades ago. They have a full list of bank accountability demands online.The organization says two bank accountability promises have been partially kept. One of these saw a temporary excess profits tax placed on banks and insurance companies that earn more than $1 billion a year (of 15%, but for one year only in 2022) and an increase in their annual tax rate of 1.5%.However, the Liberals promised they would impose a higher 3% increase in the annual rate. By comparison, England imposed a more than 8% tax hike on banks in 2011 and Australia increased its bank tax rate in 2017.Secondly, Ottawa will require all banks to use the Ombudsman for Banking Services and Investments (OBSI) as the complaint-appeal entity as of November 1, 2024. However, the Liberals broke their promise to give OBSI “the power to impose binding arbitration.”Canada’s big six banks reported annual profits totalling $58.3 billion in 2023 and record total profits of $61 billion in 2022, almost triple their 2010 profits. Conacher said this was “all reaped through gouging their customers with excessively high credit card and other credit interest rates and mutual fund and other banking fees.”Four of Canada’s big six banks are listed in Fortune’s Global 500 for 2023 (based on 2022 profits), and TD, RBC, Scotiabank and BMO were also in the top 35 most profitable financial institutions in the world in 2022. Meanwhile, two banks are among the five most profitable Canadian companies in the Global 500.Canada’s big six banks also paid their CEOs a total of $73.3 million in 2022 (an average of $12.2 million each, 55% higher than in 2008) and in 2023 handed out $21.2 billion total in bonuses to their employees.More information is available on DWatch’s Canada’s Big Banks Backgrounder.
