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News Release

Occupy Canada protesters should support 15 key bank and corporate responsibility changes endorsed by 140 citizen groups across Canada for the past decade

Wednesday, October 12, 2011

OTTAWA - Today, Democracy Watch suggested that the people planning to begin demonstrating on Bay St. in Toronto and in cities across Canada this weekend on bank and corporate responsibility issues should support the 15 key measures endorsed for the past decade by 140 citizen groups across Canada that are members of the Canadian Community Reinvestment Coalition and/or the Corporate Responsibility Coalition (both of which were organized, and are coordinated, by Democracy Watch, the largest and leading coalitions on these issues in Canada).

"Canada's bank accountability and corporate responsibility laws and enforcement systems are full of loopholes and are weakly enforced and so allow for irresponsible actions by the biggest businesses across the country,” said Duff Conacher, Founding Director of Democracy Watch.  "Anyone interested in actually increasing bank accountability and corporate responsibility should support the 15 key changes that 140 citizen groups across Canada have endorsed, and been pushing for more than a decade, to increase whistleblower protection and penalties for irresponsible actions, and to require all big businesses to facilitate the creation of citizen watchdog groups, to take into account stakeholder interests, and to disclose details about all their activities and submit to regular independent audits and inspections."

From all reports, people are calling on everyone to attend various peaceful demonstrations in cities across Canada to address the general issues of bank accountability and corporate responsibility.  However, as many commentators have pointed out, without specific proposals for change the demonstrators will not be effectively pressing politicians and corporate executives to do anything that will actually address their concerns.

The nation-wide coalitions Democracy Watch coordinates have done in-depth research into the most systemic problems with lack of bank accountability and corporate responsibility in Canada, and developed the 15 key measures as the most effective ways to solve those problems.  The coalitions have also won about half of all the measures they have pushed for in the past 15 years.

The 15 key bank accountability and corporate responsibility measures are as follows: :
Key Corporate Responsibility Measures

  1. Require corporations (including banks and other financial institutions) to send a pamphlet to individual shareholders and customers inviting them to join watchdog groups for each corporate sector (some U.S. states have required utilities to do this -- See details on Democracy Watch's Citizen Association Campaign webpage);
  2. Require corporate directors to consider stakeholder interests (represented by workers, customers, communities, social justice and environmental groups) in making decisions, and to account publicly for the extent to which they do (including reducing waste to the best world standard, and paying all the costs of recycling and cleaning up any waste or pollution that results from what the corporation produces, all to the best world standards);
  3. Require corporations to disclose their records of compliance with environmental, criminal, competition, human rights, labour, health and safety laws, and set up an on-line, searchable database so that the public has easy access to the information;
  4. Establish an effective system (including a fully independent, fully empowered watchdog agency) to protect, from any form of retaliation, "whistleblower" employees who disclose corporate wrongdoing to the public or to the government;
  5. Prohibit corporations that violate laws from receiving grants or contracts from any government for a specific period of time (e.g. 5-10 years), and;
  6. Allow stakeholders to apply in court for the dissolution of a corporation that repeatedly violates laws.
Key Bank Accountability Measures
  1. Facilitate the creation of a Financial Consumer Organization (FCO) to help consumers, as the Task Force on the Future of the Canadian Financial Services Sector recommended in its September 1998 Report and as supported by 64% of Canadians.  This organization could be set up very easily and at a low cost if the federal government required banks and other financial institutions to enclose an FCO flyer in their mailings to customers, inviting people to join the watchdog group.  No bank takeover or merger should be allowed until the FCO is set up using this method (See details about this proposal on Democracy Watch's Citizen Association Campaign webpage);
  2. Require banks to provide detailed information on loans, investments and services to customers, as required in the U.S.  We need to track whether banks are meeting the needs of individuals and businesses on a community-by-community level and, as in the U.S., require corrective action if banks are not meeting customer needs (including not allowing banks to merge or to takeover other financial institutions (such as TD Bank's takeover of Canada Trust) if they do not serve all customers well);
  3. Prohibit any service charge or credit card interest rate increases until the banks prove (through an independent audit conducted by the Auditor General of Canada) that they aren't gouging us with excessive service and credit card charges, and lower fees and interest rates if audit reveals gouging;
  4. Require banks to disclose the profit/loss record for any branch proposed to be closed, to allow for a full review of the reasons for the closure;
  5. Empower either the federal Competition Bureau, or the federal Financial Consumer Agency of Canada to conduct an audit of how much money Canada's banks have made from gouging customers with excessive service and credit card charges, and closing branches and firing tellers, since 1992;
  6. Empower either the federal Competition Bureau, or the federal Financial Consumer Agency of Canada, to conduct a nation-wide examination of the actual level of choice for consumers (ie. level of competition) in financial services in each community across Canada, and issue a public report;
  7. Require the Financial Consumer Agency of Canada Commissioner to conduct "mystery shopper" audits of financial institution compliance with laws at least every 3 years, and to disclose the name of the financial institution and the terms of any settlement whenever the Commissioner finds that an institution has violated the law (currently, the Commissioner can only disclose the name of the institution if the Commissioner prosecutes the institution), and change the complaint process to require all financial institution to be covered by the Ombudsman for Banking and Investments (OBSI) and allow consumers to complain to the OBSI directly at any time without having to go first to their bank's ombudsman;
  8. Give customers access to the money they deposit by cheque as soon as the cheque clears (Bill C-37 (which became federal law in April 2007) only reduces the cheque hold period from the usual 10 days to 4-7 days, even though 98 percent of cheques clear in one day), and;
  9. Increase the maximum penalty for violating the Bank Act to $50 million (currently, the maximum penalty is $200,000, an essentially meaningless penalty for Canada's big banks which each make $15 billion in revenue each year).
Democracy Watch and its coalitions will continue pushing for these measures until federal and provincial politicians finally act in the public interest and make the changes.

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Duff Conacher, Founding Director of Democracy Watch
Chairperson of the nation-wide Corporate Responsibility Coalition
Chairperson of the nation-wide Canadian Community Reinvestment Coalition
Tel: (613) 789-5753

To see news release about other key financial institution accountability measures, click here

To see the CCRC's analysis of the flaws in Bill C-37, which changed the Bank Act and other federal financial institution laws in April 2007, click here

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Canadian Community Reinvestment Coalition
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