BMO to pay $49.9M to compensate investment clients charged excess fees
BMO joins CIBC, Scotiabank on list of banks to pay compensation over excess fees
BMO will pay $49.9 million in compensation to clients who were charged excess fees on some mutual funds and investments products.
The payment is part of a no-contest settlement worked out by the Ontario Securities Commission and four BMO divisions — BMO Nesbitt Burns Inc., BMO Private Investment Counsel Inc., BMO Investments Inc. and BMO InvestorLine Inc.
The OSC said in a release that the settlement follows allegations by its staff there were inadequacies in the control and supervision systems at BMO, which resulted in some clients paying excess fees that were not detected or corrected in a timely manner.
The OSC said it does not allege or any evidence of dishonest conduct by the BMO companies, which discovered and self-reported the problem.
BMO has neither admitted nor denied the accuracy of the facts and conclusions of the provincial securities regulators.
The bank will pay an additional $2.1 million to the OSC to advance its investor protection mandate, plus $90,000 to cover OSC investigation costs.
BMO is the latest financial institution to reach a deal with the OSC on similar allegations.
CIBC said in October that it would pay $73.3 million in compensation to clients who were charged excess fees over a 14-year period. The OSC said in July that Scotiabank would pay $19.9 million to clients to settle a similar case.