Advertisement
Canada markets close in 5 hours 58 minutes
  • S&P/TSX

    21,887.69
    +50.51 (+0.23%)
     
  • S&P 500

    5,137.96
    -11.46 (-0.22%)
     
  • DOW

    38,858.72
    +68.29 (+0.18%)
     
  • CAD/USD

    0.7347
    -0.0042 (-0.57%)
     
  • CRUDE OIL

    82.92
    +0.20 (+0.24%)
     
  • Bitcoin CAD

    86,215.40
    -5,671.45 (-6.17%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,154.90
    -9.40 (-0.43%)
     
  • RUSSELL 2000

    2,017.36
    -7.38 (-0.36%)
     
  • 10-Yr Bond

    4.3180
    -0.0220 (-0.51%)
     
  • NASDAQ

    15,994.24
    -109.21 (-0.68%)
     
  • VOLATILITY

    14.58
    +0.25 (+1.74%)
     
  • FTSE

    7,723.76
    +1.21 (+0.02%)
     
  • NIKKEI 225

    40,003.60
    +263.20 (+0.66%)
     
  • CAD/EUR

    0.6767
    -0.0025 (-0.37%)
     

CIBC seeks no contest settlement with OSC after overcharging for investment fees

A Canadian Imperial Bank of Commerce (CIBC) sign is seen outside of a branch in Ottawa, Ontario, Canada, May 26, 2016. REUTERS/Chris Wattie (REUTERS)

CIBC is seeking a no contest settlement with the Ontario Securities Commission after its investment business had been accidentally overcharging some of its customers for as much as 14 years.

CIBC World Markets Inc., CIBC Investor Services Inc. and CIBC Securities Inc. mistakenly charged some of their customers excess fees for mutual funds, ETFs and other investment products dating back to 2002, according to a statement of allegations released by the regulator.

According to the document, the bank self-reported the activities to the regulator after uncovering "inadequacies" in the way it was charging some of its customers for investment products.

- ANALYSIS: Fees are too high, so why do we pay them?

ADVERTISEMENT

In some cases, customers paid higher Management Expense Ratios than they should have, based on the size of their investment portfolios. In others, customers were charged trailer fees for ETFs that they shouldn't have been.

"Commission staff do not allege, and have found no evidence of, dishonest conduct by the CIBC Dealers," the OSC says in the statement of claim.

No reimbursement plan evident

Neither the bank nor the OSC disclosed how much customers were overcharged by over the years, but the bank has the "intention to pay appropriate compensation to clients and former clients," the statement of claim says.

The bank is seeking a "no-contest settlement" with the regulator, and the details of their compensation plans will be outlined at a hearing on Friday into the matter.

In July, the OSC reached a settlement with some of Scotiabank's investment arms along similar lines. In that case, the bank agreed to reimburse customers $19,997,821 worth of fees they shouldn't have been charged.

In February, CI Investments Inc. agreed to pay $156.1 million to reimburse some of its clients for understating the value of its mutual funds while clients were buying and selling them.