The Financial Consumer Agency of Canada published a supervisory highlight summarizing a thematic review of banks’ compliance with the Bank Act obligation to provide electronic alerts, identifying multiple instances where consumers did not receive required alerts or received them late across six small and medium-sized banks. The review covered requirements to send e-alerts without delay for personal deposit accounts, credit cards and lines of credit when balances or available credit fall below a consumer-set threshold or the default CAD 100, to include prescribed information in each alert, to allow consumers to set the threshold or opt out in writing, and to maintain effective monitoring, testing and reporting. Key issues included banks making online banking registration a condition for receiving alerts, excluding certain account types, failing to proactively obtain consumer contact information, and delays of more than 24 hours in sending alerts due to internal systems and processes. While the language used in alerts was generally clear, FCAC found missing required content, particularly what consumers can do to avoid charges or penalties and the timeframe to do so, and inconsistent recordkeeping evidencing written opt-outs. The report also raised concerns about informal testing approaches, uneven compliance reporting, and operational and compliance risks where third-party providers constrained product coverage, delivery channels, or the timeliness of alert data. Each bank in scope has been notified of institution-specific findings and is required to implement corrective actions, which FCAC is actively monitoring. FCAC expects all banks, including major banks, to review the findings, assess their own compliance with e-alert requirements, and address any deficiencies on a timely basis.
Financial Consumer Agency of Canada 2025-03-20
Financial Consumer Agency of Canada identifies electronic alert compliance weaknesses at small and medium-sized banks and sets supervisory expectations
The Financial Consumer Agency of Canada released a supervisory highlight from a review of six small and medium-sized banks, revealing non-compliance with the Bank Act's electronic alert requirements. Issues included delayed alerts, missing content, and inadequate consumer contact information, with banks often requiring online banking registration for alerts. Banks have been notified of specific findings and must implement corrective actions, with FCAC monitoring compliance.