Kootenay-Columbia Member of Parliament Wayne Stetski criticized Liberal Finance Minister Bill Morneau for bureaucratic nitpicking that could cost credit unions millions of dollars.
At issue is a June 30 edict from the Office of the Superintendent of Financial Institutions (OSFI) forbidding credit unions from using simple, common terminology including “bank, banking,” and “banker”.
“Frankly, this is ridiculous,” Stetski said. “It is outrageous. Our credit unions are highly regulated and respectable institutions that shouldn’t be blocked from using the everyday words that best describe their services.”
Stetski said that the OSFI’s pronouncement is based on an 80-year-old law — the Bank Act — that has never previously been enforced with credit unions.
“Parliament’s intent in this section of the Banking Act is to avoid obvious examples of entities deceiving the public,” he said in a statement. “It wasn’t meant to police the common verbs used by accredited institutions.”
According to the Canadian Credit Union Association, over 5.6 million Canadians use their services, including almost 2 million in British Columbia alone. There are fifteen branches across Kootenay-Columbia, representing six member-owned credit unions.
Roberta Bobicki , CEO of the Revelstoke Credit Union said that changes will lead to confusion among consumers, who won’t know what services their local credit unions are providing.
“It’s important to us that our members and the public know that credit unions can offer the same banking services that the federally regulated commercial banks offer,” she said.
“In my riding of Kootenay-Columbia, credit unions give a significant amount of their profit back to their community every year,” Stetski said. “This unconscionable ruling will cost Canada’s credit unions $80 million meaning they’ll have less to give back.”
Stetski said he has written Morneau and urged him to quickly amend the regulations or the Banking Act to allow credit unions to use the verbs and adverbs that describe their business.
“The OSFI is supposed to work on behalf of Canadians by supervising the banks,” Stetski said. “And here they’re protecting the banks at the expense of Canadians. This goes against common sense, it goes against good management, and it goes against the interest of consumers.”