Responsibility to monitor account balances
In early 2009, Ms. B was set to receive $59,000 as part of a severance package. On the advice of bank staff Ms. B opened a Registered Retirement Savings Plan (RRSP) account, into which she deposited the severance payment.
One month later, Ms. B made another deposit to the RRSP account, this time a $9,000 Guaranteed Investment Certificate (GIC) from a retirement fund with her former employer. The GIC matured in 2011.
Ms. B started making monthly withdrawals of $4,800. In late 2009, she inquired with her banking representative as to the amount remaining in her RRSP account and was told $10,400 was left. She continued to make the same monthly withdrawals.
In March 2010, Ms. B was shocked to learn that her RRSP was almost completely depleted. In addition, the GIC had been redeemed early to satisfy the amounts required for the monthly withdrawals. Ms. B complained to the bank that it had improperly informed her of the account balance, as only the remaining severance and not the GIC amount should have been included in the account total. She requested $9,000 in compensation, representing the original value of the GIC.
The bank turned down Ms. B's request, saying that Ms. B received correct information from them. The bank had made clear to Ms. B that the account total of $10,400 included the value of the GIC and that, furthermore, Ms. B was advised she would have to redeem the GIC early in order to maintain her regular monthly withdrawals. The bank pointed to the fact the branch employee sought and obtained approval from his manager to process the early redemption of the GIC as evidence that Ms. B must have given specific direction to do so. Ms. B rejected the bank's version of events and escalated her complaint to OBSI.
Complaint not upheld
We interviewed Ms. B and the bank employee who processed the account withdrawals. While we were unable to determine what exactly was said between Ms. B and the employee, it is highly unlikely a bank employee would obtain a manager's approval without the necessary signoffs from a client. Furthermore, we noted Ms. B received regular statements from the bank detailing her account balance and type of investments. Ms. B admitted she did not review her statements and had assumed she had sufficient funds for the withdrawals.
Clients have a duty to monitor their account statements and report any problems they discover. In Ms. B's case, her statements clearly indicated the $59,000 severance amount was nearly exhausted and that continued withdrawals would require the early redemption of the GIC. OBSI did not recommend compensation.
(2011)