Canadian investors using online discount brokers could soon receive a cash payout. This comes after RBC agreed to a $45 million settlement over unfair fees.
The deal compensates anyone globally who held RBC or PH&N mutual funds through a discount broker between December 28, 2003, and July 25, 2024.
A lawsuit by Toronto-based Siskinds LLP alleges the bank deducted “trailing commissions,” which are fees meant to pay for financial advice.
“Discount brokers primarily operate online. They are not allowed to provide investment advice.” the lawsuit alleges.
“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.”
Next steps and deadlines
The Ontario Superior Court of Justice will hold a hearing on Sept. 8, 2026, to officially approve or reject the $45 million deal. If the court signs off on the agreement, a formal distribution protocol will be established to explain how investors can claim their money.
However, the total cash pool may be reduced before reaching investors. Siskinds LLP is requesting $12.6 million in legal fees, plus additional court expenses and taxes, directly from the settlement fund.
RBC denies wrongdoing
RBC has denied all allegations and admitted no legal wrongdoing or liability. According to the settlement agreement, the bank agreed to the deal solely to avoid the costs, risks, and prolonged uncertainties of trials and appeals.
“The Settlement Agreement is not an admission of liability, wrongdoing, or fault on the part of the Defendants, which have denied, and continue to deny, the allegations against them,” the proposed agreement reads.
Key takeaways for investors
Affected class members are included automatically and require no immediate action to participate.
Investors wishing to object to the settlement terms or requested legal fees must file a formal objection by August 18, 2026.
