Trailing commissions (also known as trailer fees) paid on mutual funds are intended to compensate mutual fund dealers for investment advice they provide to investors. Trailing commissions are also paid to discount brokers. Discount brokers primarily operate online and include BMO InvestorLine, TD Direct Investing, RBC Direct Investing, CIBC Investor’s Edge, Scotia iTRADE and National Bank Direct Brokerage. They are not allowed to provide investment advice. It is alleged by the plaintiffs that, since no advice is provided to investors who purchase mutual funds through discount brokers, these investors receive no value for the trailing commissions that reduce the value of their mutual fund investments.
Siskinds LLP has filed proposed class actions against various mutual fund trustees and managers challenging the trailing commissions they have paid to discount brokers on mutual funds under their management. The class actions seek damages for the mutual fund investors.
Have you ever held mutual funds in a discount brokerage account? We want to hear from you. Click the "Join" button above or complete the "Get In Touch" form below to learn more about our cases. Your information will be held in strict confidence. By completing the form, you are not retaining Siskinds LLP, nor do you incur any obligations in connection with the class actions. You may also email us at [email protected].
Developments
Seven class action lawsuits have been filed by Siskinds LLP challenging the payment of trailing commissions to discount brokers. Each case claims damages and other relief. As described below, the actions against TD Asset Management Inc., BMO Investments Inc., CIBC Trust Corporation and Canadian Imperial Bank of Commerce, and Mackenzie Financial Corporation, Mackenzie Financial Capital Corporation and 1832 Asset Management L.P. have been certified as class proceedings. The other action against RBC Global Asset Management Inc. and RBC Investor Services Trust is currently in the pre-certification stage. Details of each action are provided below.
TD Asset Management Inc.
In April 2018, a proposed class action was filed against TD Asset Management Inc. The action was certified as a class proceeding on February 27, 2020 (a copy of the certification decision and order is available here). On October 2, 2020, TD Asset Management Inc.’s leave to appeal was dismissed. The certified class is defined as all persons, wherever they may reside or be domiciled, who held or hold, at any time prior to the conclusion of the trial of the common issues in the proceeding, units of a TD mutual fund trust through a discount broker, except for certain excluded persons.
Please review the notices of certification below for important information about this class action. The deadline for opting out of this class action has expired.
TDAM Long-Form Notice of Certification – English
TDAM Long-Form Notice of Certification – French
TDAM Short-Form Notice of Certification – English
TDAM Short-Form Notice of Certification – French
BMO Investments Inc.
In December 2018, a proposed class action was filed against BMO Investments Inc. The action was certified as a class proceeding on May 18, 2021 (a copy of the certification order is available here). On September 13, 2021, BMO Investments Inc.’s motion for leave to appeal was dismissed. The certified class is defined as all persons, wherever they may reside or be domiciled, who held or hold, at any time on or prior to May 18, 2021, units of a BMO mutual fund trust through a Discount Broker except for certain excluded persons.
Please review the notices of certification below for important information about this class action. The deadline for opting out of this class action has expired.
BMO Long-Form Notice of Certification - English
BMO Long-Form Notice of Certification - French
BMO Short-Form Notice of Certification - English
BMO Short-Form Notice of Certification - French
National Bank Investments Inc. and Natcan Trust Company
In December 2018, a proposed class action was filed against National Bank Investments Inc. and Natcan Trust Company. The action was certified as a class proceeding on August 5, 2022 (a copy of the certification order is available here). The certified class is defined as all persons wherever they may reside or be domiciled, who held or hold units of a National Bank Mutual Fund or NBI Private Portfolio Mutual Fund through a Discount Broker, expect for Excluded Persons, from December 28, 2003 to August 5, 2022.
The certified class is defined as all persons wherever they may reside or be domiciled, who held or hold units of a National Bank Mutual Fund or NBI Private Portfolio Mutual Fund through a Discount Broker, expect for Excluded Persons, from December 28, 2003 to August 5, 2022.
Please review the notices of certification below for important information about this class action. The deadline for opting out of this class action has expired.
National Bank Long-Form Notice of Certification [English] [French]
National Bank Short-Form Notice of Certification [English] [French]
National Bank Opt-Out Form [English] [French]
1832 Asset Management L.P.
In June 2018, a proposed class action was filed against 1832 Asset Management L.P. The action was certified as a class proceeding on December 18, 2023. The certified class is defined as all persons, wherever they may reside or be domiciled, who held or hold units of a 1832 Mutual Fund that paid trailing commissions through a Discount Broker, except for the Excluded Persons, from June 25, 2003 to December 18, 2023. A copy of the certification decision and order is available here.
Please review the notices of certification below for important information about the class action: 1832 Asset Management L.P. [English] [French] - Long-Form Notice of Certification. The deadline for opting out of this class action is May 7, 2024.
CIBC Trust Corporation and Canadian Imperial Bank of Commerce
In September 2018, a proposed class action was filed against CIBC Trust Corporation and Canadian Imperial Bank of Commerce. The proposed class is all persons, wherever they may reside or be domiciled, who held or hold units of a CIBC Mutual Fund through a Discount Broker, except for certain excluded persons, from September 18, 2003 to January 25, 2024. A copy of the certification decision and order is available here.
Please review the notices of certification below for important information about the class action: CIBC Trust Corporation and Canadian Imperial Bank of Commerce [English] [French] - Long-Form Notice of Certification. The deadline for opting out of this class action is May 26, 2024.
Mackenzie Financial Corporation and Mackenzie Financial Capital Corporation
In December 2018, a proposed class action was filed against Mackenzie Financial Corporation and Mackenzie Financial Capital Corporation. The proposed class is all persons, wherever they may reside or be domiciled, who held or hold units of a Mackenzie Trust Mutual Fund or shares of a Mackenzie Corporate Class Mutual Fund through a Discount Broker, except for certain excluded persons, from December 6, 2003 to January 25, 2024. A copy of the certification decision and order is available here.
Please review the notices of certification below for important information about the class action: Mackenzie Financial Corporation and Mackenzie Financial Capital Corporation [English] [French] - Long-Form Notice of Certification. The deadline for opting out of this class action is June 2, 2024.
RBC Global Asset Management Inc. and RBC Investor Services Trust
In December 2018, a proposed class action was filed against RBC Global Asset Management Inc. and RBC Investor Services Trust. The proposed class is all persons, wherever they may reside or be domiciled, who held or hold, at any time prior to the conclusion of the trial of the common issues in the proceeding, units of a RBC or PH&N mutual fund trust through a discount broker, except for certain excluded persons.
FAQs
Who is affected by this class action?
You are affected by these class actions if you hold or held, through a discount broker, units of a TD mutual fund trust, units of a Scotia or Dynamic mutual fund trust, units of a CIBC mutual fund trust, units of a RBC or PH&N mutual fund trust, units of a BMO mutual fund trust, units of a National Bank mutual fund trust, or units of a Mackenzie mutual fund trust or shares of a Mackenzie corporate class mutual fund.
What is a class action?
A class action is a lawsuit that is brought by one or more persons on behalf of a larger group of people whose claims share common legal and/or factual issues. Class actions provide a cost-effective way for groups of people with common interests to pursue a legal claim.
What does “certification” mean?
Certification is the motion where the court determines whether the action can properly be pursued as a class action. The court will consider factors such as whether the claims of the class members raise common legal and/or factual issues and whether a class action is the preferable method of pursuing the claims (as opposed to other methods, such as individual actions).
Do I have to pay anything to participate in the class action?
Class action lawyers are usually paid on a contingency basis. This means that class counsel are only paid if successful. Class counsel are paid a percentage of any settlement or court award. Class counsel fees are subject to court approval.
Can I join the class action?
There are no steps required to “join” the class action. Unless you opted-out (excluded yourself from the class action), assuming you fall within the scope of the class definition, you are automatically included in the class action.
What should I do to protect my rights?
To protect your rights, you should keep any documents that you have relating to these class actions, including any documents evidencing your purchase and sale of the mutual funds that are covered by the class actions.
I still have a question. Who should I contact?
If you have any other questions, please complete the form below or email us at [email protected].