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PROTECTING YOUR PRIVACY

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PROTECTING YOUR PRIVACY Powered By Docstoc
					What You Need to Know About                                                        Our Commitment to You
                COERCIVE TIED SELLING
                                                                                   We expect all employees at Korea Exchange Bank of Canada to comply with
The Bank Act requires banks to inform customers in plain language that             the law by not practicing coercive tied selling. We urge you to let us know if
coercive tied selling is illegal. To comply with the law, Korea Exchange Bank      you believe that you have experienced coercive tied selling in any dealing
of Canada has prepared this brochure explaining:                                   with us. You can find out how to contact us at the end of this brochure.

• what coercive tied selling is,
                                                                                   What is NOT Coercive Tied Selling?
• what coercive tied selling is not, and
• how to contact us if you have any questions, complaints or concerns.             Most businesses, including Korea Exchange Bank of Canada, look for
                                                                                   tangible ways to show their interest in your business and appreciation for your
                                                                                   loyalty. Sales practices, such as preferential pricing and bundling of products
What is Coercive Tied Selling?                                                     and services, offer potential and existing customers better price or more
                                                                                   favourable terms. These practices should not be confused with coercive tied
Section 459.1 of the Bank Act prohibits banks from practicing coercive tied
                                                                                   selling, as defined by the Bank Act. Many of these practices will be familiar to
selling. More specifically, it is against the law for a bank to “impose undue
                                                                                   you in your dealing with other businesses.
pressure on, or coerce a person to obtain a product or service from a
particular person, including a Bank and any of its affiliates, as a condition
                                                                                   What is Preferential Pricing?
for obtaining another product or service from the Bank.” You cannot be
unduly pressured to buy a product or service that you don’t want from the
                                                                                   Preferential pricing means offering customers a better price of rate on all or
Bank or one of its affiliates, to obtain another bank product or services.
                                                                                   part of their business. For example, a printer offers a lower price for each
The following two examples will help to explain coercive tide selling and          business card if you buy a thousand cards instead of a hundred. A shoe store
what is not allowed.                                                               offers a second pair of shoes at half price.

Your bank’s mortgage specialist tells you that you qualify for a                   Similarly, a bank may be able to offer you preferential pricing – a higher
home mortgage. However, you are also told that the bank will                       interest rate on investments or a lower interest on loans – if you use more of
approve your mortgage only if you transfer your investments to                     its products or services. The following two examples will help to explain
the Bank or its affiliates. You want the mortgage, but you do not                  preferential pricing in banks.
want to move your investment.
                                                                                   After approving your application for a home mortgage from the
Your bank’s credit officer tells you that you qualify for a loan.                  bank, your bank’s mortgage specialist tells you that this
However, you are also told that the bank will approve the loan                     mortgage would be available at a lower interest rate if you
only if you use the money to buy the bank’s investment products.                   transferred your investments to the bank or its affiliates.
You want the loan but you want to invest the money somewhere
else.                                                                              After approving your application for a loan, your bank’s credit
                                                                                   officer offers you a lower interest rate if you use the loan to buy
Both of the above practices are against the law. If you qualify for a product, a   the bank’s investment products.
banking representative is not allowed to excessively pressure you to buy
another unwanted product or service as a condition of obtaining the product        The above practices are acceptable. The approval of your mortgage and a loan
you want.                                                                          is not conditional on your taking another bank product or service. Rather you
                                                                                   are offered preferential pricing to encourage you to give the bank more
                                                                                   business.

                                                                                   2                           www.kebcanada.com
What is Bundling of Products and Services?                                         At the Korea Exchange Bank of Canada, our requirement for borrowers will
                                                                                   be reasonable and consistent with our level of risk.
Product and services are often combined to give consumers better prices,
incentives or more favourable terms. By linking or bundling their products or
services, businesses are often able to offer them to you at a lower combined       How Can You Contact Us?
price than if you bought each product on its own. For example, a fast-food
chain advertises a meal combination that includes a hamburger, fries and a         Please let us know if you have any questions, complaints or concerns about
drink. The overall price is lower than if you bought the three items separately.   your dealings with Korea Exchange Bank:
Similarly, banks may offer you bundled financial services or products so that      Step 1   Contact Customer Relations Officer of your branch
you can take advantage of package prices that is less than the sum of the
individual items.                                                                            Main Branch:        4950 Yonge Street, Unit 103
                                                                                                                 Toronto, Ontario M2N 6K1
The following example will help to explain the bundling of bank products and                                     Tel: (416) 222-6500 Fax: (416) 222-5855
services.                                                                                    Bloor Branch:       627 Bloor Street West
                                                                                                                 Toronto, Ontario M6G 1K8
You plan to open a bank account that charges you for individual                                                  Tel: (416) 533-8593 Fax: (416) 531-1047
transactions. The banking representative offers you a package                                Mississauga Branch: 90 Burnhamthorpe Road West
of services that includes a comparable bank account, a credit                                                    Mississauga, Ontario L5B 3C3
card with no annual fee and a discount on purchasing traveler’s                                                  Tel: (905) 272-3130 Fax: (905) 272-3430
cheques. The total price is less than if you purchased each part of                          Thornhill Branch:   7670 Yonge Street, Suite 5
the package separately.                                                                                           Thornhill, Ontario L4J 1W1
                                                                                                                 Tel: (905) 707-7001 Fax: (905) 707-0171
Bundling products in this way is permitted because you have the choice of
                                                                                             Burnaby Branch:     4900 Kingsway, Unit 100
buying the items individually or in a package.
                                                                                                                 Burnaby, British Columbia V5H 2E3
                                                                                                                 Tel: (604) 432-1984 Fax: (604) 432-1964
How Do We Manage Our Credit Risk?
                                                                                             Coquitlam Branch:      4501 North Road, Suite 202A
To ensure the safety of their depositors, creditors and shareholders, banks                                         Burnaby, British Columbia V3N 4R7
must carefully manage the risk on the loans and the credit cards they approve.                                      Tel: (604) 420-0019 Fax: (604) 420-0066
Therefore the law allows us to impose certain requirements on borrowers as a       Vancouver Downtown Branch: 590 Robson Street
condition for granting a loan – but only to the extent necessary for us to                                          Vancouver, British Columbia V6B 2B7
manage our risk.                                                                                                    Tel: (604) 609-2700 Fax: (604) 609-2777
                                                                                              Calgary Branch: 1935 37th Street SW, Unit 120
The following example will help to explain how banks manage such risk.                    (Opening in October 2007) Calgary, Alberta T3E 3A4
                                                                                                                    Tel: (403)            Fax: (403)
You apply for an operating loan for your business. To manage the
risks associated with the loan, your bank requires your business                   Step 2   Contact Chief Auditor of the Bank (if not satisfied in Step 1)
to have an operating account with the bank as a condition for
obtaining the loan.                                                                          Head Office:         4950 Yonge Street, #1101
                                                                                                                  Toronto, Ontario M2N 6K1
The above example is legal and appropriate. Having your business’s operating                                      Tel: (416) 227-5570
account at the bank allows your bank to access possible risks associated with                                     Fax: (416) 222-5288
your business’s cash flow and manage the risks associated with the loan.                                          E-mail: mikecho@keb.co.kr


                            www.kebcanada.com                                 3    4                         www.kebcanada.com
There are a number of provisions that each bank has to comply with the
requirements such as disclosure requirements, accepting government cheques
and others. If you believe that we have breached such requirements, please
contact:

Step 3 Contact Financial Consumer Agency of Canada
 (if still not satisfied in step 1 and 2)
          427 Laurier Avenue West, 6th floor
          Ottawa, Ontario K1R 1B9
          Toll-free: 1-866-461-3222       E-mail: info@fcac-acfc.gc.ca
          Fax:       (613) 941-1436       Web site: www.fcac-acfc.gc.ca




                          www.kebcanada.com                               5

				
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