Remarks by Nick Colosimo, Director of Ontario and Atlantic Canada Government Relations

Standing Committee on Finance and Economic Affairs

Wednesday, February 15, 2025

Thank you, Mr. Chair.

My name is Nick Colosimo, and I am the Director of Ontario and Atlantic Canada Government Relations at the Canadian Bankers Association (CBA). Joining me today are a plethora of our Subject Matter Experts: Alex Ciaparra, Head Economist; Lorraine Krugel, Vice President of Privacy and Data; Hartland Elcock, Legal Counsel; Alanna Barnes, Director of Digital; Pooja Paturi, Director of Digital Payments and Fraud Prevention; and Ryan Ku, Director of Financial Crimes.

We thank you for having us today as part of the Committee’s Pre-Budget Consultations.

The CBA works on behalf of more than 60 domestic and foreign banks operating in Canada and their employees.

We are proud to advocate for effective public policies that contribute to a sound, successful banking system that benefits all Canadians, including Ontarians.

Our submission – of which you all should have a copy - offers the banking industry’s views and recommendations in areas that are of interest to the Ministry of Finance’s efforts in strengthening local economies and communities across the province now and create prosperity for the future.

Canada’s banking sector has a longstanding history of supporting the Ontario economy.

• $45 billion (over 5%) to Ontario’s GDP and paid $4 billion in provincial and municipal taxes in 2023
• $28 billion in dividend income in 2023 that went to seniors, families, pension plans, charities, and endowments across Canada, including Ontario
• Over 2,300 branches and 7,600 bank-owned ATMs across Ontario, with over 6,300 Financial Planners and Financial Advisors employed by the six largest banks to provide strong, stable financial advice to consumers
• 53% of the more than 194,000 Ontarians employed by our member banks are women, and 49% being visible minorities
• Close to $918 billion in authorized business credit, of which nearly $120 billion were for SMEs

Working Together to Combat Scams

All of us have heard heartbreaking stories of friends, loved ones, and constituents falling victim to a scam.

While 75% of Canadians report encountering a scam at least once a month, the Canadian Anti-Fraud Centre (CAFC) reported a staggering $569 million lost to scams by Canadians in 2023.

However, actual losses are believed to be significantly higher, as an estimated 90% of incidents are unreported, and may be as high as $11 billion annually or 0.5% of Canada’s GDP.

In Ontario alone, the CAFC has identified that over $134 million has been lost to fraud and scams from January to September of 2024 – note that this figure also only represents 5-10% of all scams reported.

Protecting Canadians against scams is a shared responsibility that requires a coordinated, multi-sector strategy to effectively combat the evolving sophistication of scammers and mitigate rising consumer angst. A robust anti-scam strategy should:

• Educate Canadians on what they can do to reduce their exposure to scams and how to report them. Financial literacy is a core component of scam prevention and the broader well-being of Canadians.
• Prevent scams by creating the conditions to minimize opportunities for scammers to target Canadians.
• Respond effectively and with empathy to scam victims.

Harmonized AML Anti-Terrorist Financing Regime

It is critical that the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (PCMLTFA) continues to comprehensively govern the fight against money laundering (ML) and terrorist financing (TF) across Canada.

More specifically, the Government of Ontario should:

• Continue to support the federal government’s efforts to evolve the federal beneficial ownership registry into a single, pan-jurisdictional Canadian registry.
• Invest in law enforcement to support its investigation and prosecution of ML and TF cases and coordinate that work with relevant federal authorities.
• Enhance and refine the provincial forfeiture regime (i.e., Ontario’s Civil Remedies Act) to adapt to the evolution of predicate offences and ML and recover criminal property.

Credit Unions

Banks are regulated federally; however, Ontario directly regulates another component of the deposit-taking marketplace – provincial credit unions and caisse populaires.

Given the human, technological and financial resources needed to compete in the financial services market, expansion under the federal framework allows federal credit unions to benefit from economies of scale and scope.

Steps to facilitate provincially regulated credit unions to transition to the federal credit union charter include:

• Regulation to ensure a smooth and efficient process for provincial credit unions to transition to the federal level.
• Guidance that facilitates credit unions’ continuance under the federal Bank Act.

Conclusion

We thank the committee for the opportunity to contribute to its pre-budget consultation. Our recommendations address critical areas that impact families and businesses in Ontario and aim to ensure Canada’s banking system continues to support vibrant and healthy communities across the province.

Rest assured, Canada’s banks are there for Ontarians every step of the way.

Thank you.