Two divisions of HSBC Canada have reached a settlement agreement with the British Columbia Securities Commission (BCSC) for charging clients excess fees.
HSBC Investment Funds Canada (HIFC) agreed that owing to insufficient controls and supervision, it failed to consistently apply a policy that advises clients when their account holdings in an HSBC mutual fund qualifies for the lower priced Premium Series investment funds. This led to payment of extra fees by some customers.
HSBC Private Wealth Services Canada (HPWS) also agreed that it failed to consistently apply a policy, which excludes client controlled securities when calculating advisory fees on client accounts, resulting in some customers paying extra fees.
HIFC repaid 4,651 clients $7.1m, while HPWS repaid 10 clients nearly $10,000 as compensation.
The two units co-operated with the review and also agreed to pay the regulator $320,000 as part of the settlement.