Credit union deposits in Ontario to be well protected
FSRA proposes new Unclaimed Deposits Rule
To better protect credit union members and their deposits, Ontario’s financial services regulator (FSRA) is proposing an Unclaimed Deposits Rule and accompanying Guidance.
The Rule will require credit unions to transfer deposits to FSRA after the account has been inactive for 10 years and attempts to notify/locate the member have not been successful.
“We want to ensure that every reasonable step is taken to locate depositors and alert them of money that is rightfully theirs,” said Mehrdad Rastan, Executive Vice-President of Credit Union and Insurance Prudential at FSRA. “Our new Unclaimed Deposits Rule sets out the responsibilities of both credit unions and depositors. We want to ensure that the process of transferring and claiming these funds is consistent, efficient and consumer focused.”
FSRA will hold the transferred deposits for 40 years (if less than $1,000) or 100 years (if more than $1,000). If the deposits are not claimed within these timeframes, FSRA is required to transfer them to the Ontario Consolidated Revenue Fund, which benefits all Ontarians.
To claim an unclaimed deposit, a credit union member, beneficiary, or estate will need to file a claim with FSRA and provide evidence of their right to the deposit. The proposed Rule outlines requirements for credit unions and those claiming entitlement.
To support the Rule, FSRA is also releasing new Guidance for consultation. The Guidance provides transparency on how FSRA will administer the Rule. It also includes interpretation of the requirements in the Rule for both credits unions and those filing a claim.
The Rule and accompanying Guidance are being posted for a 60-day consultation period which closes on May 16, 2024.
Learn more:
FSRA continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone.
Learn more at www.fsrao.ca.