The Financial Consumer Agency of Canada(FCAC) Fines BMO $4 Million Over Disclosure Failures and Improper Fees.

Written by Tricia:

The Financial Consumer Agency of Canada (FCAC) has imposed a $4-million administrative monetary penalty on the Bank of Montreal (BMO) for violating consumer protection provisions under the Bank Act, following a lengthy period of improper fee disclosures and erroneous charges on personal deposit accounts.

In Summary of Proceeding #4, the federal regulator said the violations affected 101,091 customers who were charged monthly plan fees that should have been waived or discounted based on the terms of their accounts.

According to the FCAC’s findings, BMO failed to fully disclose all applicable charges on certain personal deposit accounts over 14 years, from 2010 to 2024. The agency also determined that between 2022 and 2024, the bank did not clearly disclose when monthly plan fees would begin, leaving customers without the information required to understand when charges would apply.

The FCAC stressed that accurate, clear, and timely disclosure is a foundational element of the consumer protection framework under the Bank Act. Without complete and accurate information, consumers may be unable to make informed financial decisions or properly assess the cost of financial products and services.

As part of its remediation efforts, BMO refunded impacted customers and paid redressed interest totalling more than $3 million. In cases where refunds could not be processed directly to customer accounts, the bank made a charitable donation exceeding $600,000, according to the regulator.

Administrative monetary penalties are imposed by the FCAC to promote compliance with federal consumer protection requirements and to deter future violations. While the penalty does not involve a finding of criminal wrongdoing, it reflects the seriousness of the compliance failures identified by the agency.

The FCAC also used the decision to reiterate expectations for the broader financial sector. All federally regulated financial institutions are expected to review FCAC decisions and summaries of proceedings and apply the findings to their own operations, as appropriate, to strengthen compliance and enhance protections for financial consumers.

The enforcement action highlights the regulator’s continued scrutiny of fee transparency and disclosure practices within Canada’s banking sector, as well as its focus on ensuring consumers are treated fairly and provided with information that meets legal standards.