The Ombudsman for Banking Services and Investments (OBSI) is fielding a growing number of complaints and questions, driven by rising contacts from bank clients.
The number of inquiries received by the dispute resolution service over the three months to April 30 rose by 7% from the previous quarter.
Inquiries involving banks, which accounted for about three-quarters of complaints, were also up 7% in the quarter. Investment-related complaints were flat quarter over quarter, but fell 9% from the same quarter a year ago.
On the investment side, complaints involving fund dealers were down 11% in the quarter, while inquiries related to investment dealers was up 4%.
Despite the increase in total inquiries to OBSI, the number of complaints that turned into cases declined in the second quarter — falling 18% to 734 cases in the second quarter (both banking and investment) from a near-record high 899 cases in the first quarter.
Banking cases were down 19% quarter over quarter, dropping to 588 cases in the second quarter from a record high of 729 cases in the first quarter.
Cases involving investment complaints fell 14% quarter over quarter to 146 from 170, and are down 37% from the same quarter in 2023.
Fund dealers led the way, with new cases down 44% from the previous quarter, and down 61% from a year ago. Investment dealer cases were down 14% quarter over quarter, and down 28% from the previous year.
“During the quarter, fraud was the leading issue for both banking consumers and investors,” OBSI noted in its report. Allegations of fraud “replaced investment suitability as the most common investment issue” in the second quarter, OBSI added.
Cases involving the calculation, disclosure and misrepresentation of investment fees rose by 24% in the quarter, and are up 62% from the previous year, OBSI also noted.
Investment cases regarding service issues were down 12% in the quarter, and down 35% year over year. Cases concerning delayed transfers were down 40% on the year, although they rose in the second quarter.
Stocks overtook mutual funds as the top product complained about among investors. Stock-related cases rose 16% in the quarter, while complaints about mutual funds fell 51% in the quarter, and were down 68% from the previous year.
Crypto cases were also up 12% in the quarter, but that’s down 36% from the same quarter a year ago.
E-transfers continued to be the most complained about bank product, followed by credit cards.