By Mark Wright
Earlier this year OBSI released its first ever Seniors Report, documenting the experiences of seniors using its services. The national, not-for-profit organization collected demographic and case data for 2017 and 2018 to create the report, which used the age of 60 as the threshold age of a senior.
The report shows that 38% of complaints to OBSI came from people over the age of 60 and that complaints from seniors are more likely to be made by men than women, especially for married complainants. Over half of these senior complainants report having household incomes below $60,000, while one-third are still active in the workforce. Most senior complainants live in an urban (53%) or suburban (27%) community. A disproportionate number come from Ontario (52%) relative to its share of the Canadian senior population (38%), followed by British Columbia (13%), Alberta (12%) and Quebec (11%).
Fraud is the most frequently reported banking issue for seniors. Credit cards are the bank product OBSI received the most complaints about from consumers over 60. Credit card chargebacks are the most complained about combination of bank product and issue. For seniors over 70, missing or lost funds also led as an issue for complaints. The report contains several case studies illustrating these issues.
The report showed that older Canadians are more likely than younger Canadians to file complaints relating to investment issues. Seniors’ investment-related complaints related predominantly to mutual funds and common shares, and their complaints mostly focus on the advice that they received when making these investments. The suitability of common shares and mutual funds, as well as fee disclosure, were the most complained about combination of investment products and issues.
Included in the report are several case studies illustrating the issues most complained about by seniors, including cases of seniors who have complained about investing in high risk investments with unexpected fees, have found themselves holding investments they can’t sell, have run into trouble with estate planning in times of crisis, have fallen victim to frauds, and have experienced problems with joint accounts and powers of attorney.
“OBSI has been helping Canadian consumers and financial services firms resolve their disputes for over 23 years,” said Sarah Bradley, Ombudsman and Chief Executive Officer, OBSI. “We are well positioned to observe the difficulties that senior consumers can face when they have a problem with the financial services they use.”
Some of the challenges faced by seniors that OBSI identified in its report include:
- Barriers to effective access to financial services – these include information barriers, emotional and social barriers, physical barriers, and economic barriers that affect seniors to a greater extent than younger Canadians.
- Communication challenges – seniors often report being overwhelmed by lengthy disclosure documents that contain too much information and require extended periods of attention and focus.
- Technology challenges – technology offers some innovative solutions for the challenges seniors face, but in general, they are less likely to take advantage of newer technologies. Even seniors who are comfortable with technologies, such as online banking, are nevertheless more vulnerable than younger clients because they may not be as aware of the security measures they need to protect their interests.
Policy and practical solutions
The report also highlighted a number of solutions financial services providers and regulators could consider to reduce the challenges faced by seniors, such as:
- Encouraging financial service providers to identify and use “trusted person” procedures
- Providing protection for providers of financial services who take action in what they reasonably believe to be the best interests of the consumer
- Ensuring that employees of financial services firms have the right incentives to provide appropriate services to seniors
- Using shorter, simpler documents that may also be taken away to share with trusted family members or advisors before making decisions
- Increasing the number of specific warnings to senior clients at key junctures or moments of risk
- Training for employees who deal with senior consumers and clients should encourage them to recognize vulnerabilities, perform basic assessments of capacity and adjust the delivery of information to the needs of the individual
The 2019 Seniors Report can be found on our website in both English and French.
Canada’s Ombudsman for Banking Services and Investments (OBSI) is a national, independent and not-for-profit organization that helps resolve and reduce disputes between consumers and financial services firms in both official languages. OBSI is responsive to consumer inquiries, conducts fair and accessible investigations of unresolved disputes, and shares its knowledge and expertise with the stakeholders and the public. If a consumer has a complaint against an OBSI participating bank or investment firm that they are not able to resolve with the bank or firm, OBSI will investigate at no cost to the consumer. Where a complaint has merit, OBSI may recommend compensation up to a maximum of $350,000.
For more information, contact:
Mark Wright, Director, Communications and Stakeholder Relations
Canadian Elder Law Conference 2019
To learn more about OBSI, join us for the Canadian Elder Law Conference 2019. Ombudsman and CEO, Sarah Bradley will be presenting at the conference, sharing how OBSI can help consumers, on Thursday, November 14.