Canadians can now claim part of a $26-million CIBC settlement
Eligible Canadians can now claim a chunk of a massive CIBC Mutual Funds and Renaissance Mutual Funds class-action settlement.
On Friday, the Ontario Superior Court of Justice approved a settlement with CIBC and CIBC Trust Corporation for $26 million to resolve a class action against various mutual fund trustees and managers, challenging the trailing commissions they paid to discount brokers on mutual funds under their management.
Trailing commissions, also known as trailer fees, are compensation for mutual fund dealers who advise investors. However, over the years, these commissions were also paid to discount brokers, who are not allowed to provide investment advice.
Discount brokers, which mainly operate online, include BMO InvestorLine, TD Direct Investing, RBC Direct Investing, CIBC Investor’s Edge, Scotia iTRADE and National Bank Direct Brokerage.
“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,” explained law firm Siskinds LLP on the class action site.
The settlement notice noted that this is “not an admission of liability or wrongdoing” by CIBC and CIBC Trust Corporation, but an “efficient compromise” between the parties.
Who’s eligible for the CIBC settlement?
Krakenimages.com/Shutterstock
According to Siskinds, the class action is on behalf of all people, wherever they reside, who held or hold units of a CIBC Mutual Fund trust or a Renaissance Mutual Fund trust through a discount broker from Sept. 18, 2003, to Jan. 25, 2024.
The deadline to file a claim for compensation is Oct. 21, 2026. You can submit a claim on the settlement website.
“Please note you may have received multiple emails or mail notifications regarding the claims filing process,” reads the site. “This occurs in situations where a Class Member has multiple accounts with CIBC/Renaissance and the details for those accounts are not identical (e.g. different names, additional account holders, differing mailing addresses, etc.).”
The site advises class members who have received multiple claim notices to submit each separately using the unique claim ID and PIN information after selecting “File a Claim” followed by “I have a Claim ID and PIN, and I would like to securely file a claim online.”
Canadians who held units of a CIBC Mutual Fund or a Renaissance Mutual Fund other than through a discount broker (e.g. through an investment advisor), there is a separate settlement for you.