Monitoring your RESP statements

Key Learnings:

• Follow up on all the financial decisions you make with your investor or advisor.
• Always read your investment statements carefully so that you are aware of how your investments are doing and can make any necessary corrections in a timely manner.

Mr. and Ms. L set up an RESP for their son with a Scholarship Plan Dealer in 2004. During the winter of 2005 the couple received a Canadian Education Savings Grant (CESG) application from the firm to fill out on behalf of their son. Shortly after, they sent the completed application back to the firm, and in a separate email they sent their son’s Social Insurance Number (SIN) number, which was required to complete the application. Correspondence occurred afterwards regarding the SIN number, but they did not receive confirmation of the firm having filed the CESG application. In 2015, Mr. and Ms. L realized their son had not received the CESGs in his RESP from 2005 – 2012 and raised those concerns with their firm shortly after. The firm claimed they had not received the original CESG application and therefor would not be responsible for reimbursing the beneficiary of Mr. and Ms. L’s RESP account in the amount that was missing. The couple then brought their case to OBSI.

Mr. and Ms. L were able to provide OBSI with a copy of their completed CESG application from 2005 along with records of correspondence with the firm. As a result OBSI was able to verify their claim that the couple did in fact submit the CESG application. As such, it is likely that the CESG application was not processed at that time due to an error by the firm and not Mr. and Ms. L. 

OBSI calculated the total financial harm incurred to the plan beneficiary as $2,733 using the 3-year GIC rates obtained from the Bank of Canada and the summary of contributions that the firm provided to OBSI. As a result, OBSI found that the firm should provide compensation to the plan beneficiary for the missed CESGs from 2005 to 2012 and the interest that would have been earned on those grants.

The firm responded to OBSI’s findings. They claimed not to have received their clients CESG application in 2005 or 2006. The firm also stated that it is the client's obligation to keep track of their investment, and it should not have taken as long as it did for the couple to notice the grant had not been filed. In the case of Mr. and Ms. L, they should have monitored their statements closely to ensure the grant was received, as a result the firm would not compensate the plan beneficiary in the amount recommended by OBSI.  Instead, they sent a counter offer for settlement totaling $1,220 and, although it was less than OBSI deemed to be reasonable, Mr. and Ms. L accepted it.