The performance of mutual funds might be falling, but that isn’t stopping salespeople at Canada’s largest banks from selling them to customers.
What happened: An Ontario Securities Commission and Canadian Investment Regulatory Organization survey of 2,863 mutual fund salespeople found 40% of them said that internal “scorecards” have influenced their decisions on what services or products to offer clients.
- A CBC News investigation from last year found high-pressure sales tactics at Canadian banks were leading to more recommendations for unsuitable products.
- Almost half of those surveyed said they feared losing their jobs if they missed targets, and nearly a third said they were paid for sales volume rather than quality of advice.
Why it matters: According to experts interviewed by the Toronto Star, the Big Five’s 5,000 bank branches remain a crucial way for Canadians to get advice on what to do with their finances, and the expectation should be that banking representatives are acting on clients’ best interests.
Big picture: This is especially important as a growing number of Canadians are feeling strapped for cash. More than half of those surveyed by RBC this year said they felt “financially paralyzed" and almost half said they could no longer maintain their standard of living.—SB