In a conference speech, the Financial Consumer Agency of Canada (FCAC) outlined further modernization of its supervision of federally regulated financial institutions under the Financial Consumer Protection Framework, including the introduction of a new internal Market Conduct Risk Assessment Model and a planned increase in the number and frequency of compliance examinations. The Director of Supervision also flagged supervisory expectations around third-party distribution arrangements, complaint handling, and remediation when consumers experience financial harm following a breach of market conduct obligations. The risk model is intended to support a more data-driven, tailored approach by assessing factors such as entity size and compliance behaviour, drawing on inputs including quarterly complaints data, reportable compliance issues, compliance examination results, and other supervisory engagements, with future expansion to examine sales, marketing, and compensation practices and to incorporate other intelligence sources. FCAC described how compliance examinations test how institutions manage specific market conduct obligations and can result in action plans, compliance agreements, or enforcement, and pointed to thematic review findings where some banks did not treat all expressions of dissatisfaction as complaints or did not resolve complaints within the prescribed 56-day period, and where some consumers did not fully benefit from electronic alert protections due to delays or incomplete information. The speech reinforced expectations for clear disclosures and branding in partner and intermediary arrangements, reiterated that banks and federal credit unions should route complaints through their own processes and the Ombudsman for Banking Services and Investments (OBSI), and stated that supervised entities are expected to remediate affected consumers, with FCAC supervision resulting in over CAD 38 million reimbursed to more than 745,000 consumer and business accounts in fiscal year 2024–2025. FCAC also noted work to renew the National Financial Literacy Strategy through stakeholder engagement and highlighted recent Canadian Financial Capability Survey insights showing that 35% of Canadians sought financial advice in the past year, mostly from free sources, with younger Canadians increasingly turning to social media and informal networks.
Financial Consumer Agency of Canada 2025-11-25
Financial Consumer Agency of Canada sets out new market conduct risk assessment model and plans more compliance examinations
The Financial Consumer Agency of Canada (FCAC) announced enhancements to its supervision of federally regulated financial institutions, including a new Market Conduct Risk Assessment Model and increased compliance examinations. The FCAC emphasized expectations for third-party distribution, complaint handling, and consumer remediation, noting over CAD 38 million reimbursed to consumers in fiscal year 2024–2025. Additionally, the FCAC is renewing the National Financial Literacy Strategy, with surveys indicating more Canadians seeking financial advice through social media and informal networks.