Reforming the System to Protect Access and Ensure Justice

Derisking has become a quiet enabler of exclusion in Canada’s financial system — harming individuals, silencing communities, and weakening civil society. But it doesn’t have to be this way. These outcomes are not the result of fair oversight or due diligence; they’re the byproduct of outdated policies, unchecked algorithms, and fear-driven decision-making. Reform isn’t optional — it’s overdue. This page lays out the solutions we need to ensure that access to banking is a right, not a privilege — and that no one is punished for who they are, where they come from, or what they stand for.

Regulatory Oversight & Transparency

Problem

Financial institutions can label people and organizations as “high risk” with little oversight and no accountability.

Solution

  • Enforce mandatory reporting when accounts are closed due to derisking.
  • Require institutions to notify affected parties and provide a clear explanation.
  • Mandate independent audits to assess the impact of derisking policies on vulnerable communities.

Strengthen Anti-Discrimination Laws

Problem

Racialized and Muslim communities are disproportionately targeted under vague “risk” categories.

Solution

  • Strengthen enforcement of existing anti-discrimination laws in the financial sector.

  • Expand the Canadian Human Rights Act to explicitly recognize financial access as a protected right.

  • Investigate systemic profiling practices and their connection to derisking.

Clear Appeals and Redress Mechanisms

Problem

Most people affected by derisking have no clear path to challenge the decision or access justice.

Solution

  • Require all financial institutions to implement an accessible, independent appeals process.

  • Empower ombudsman offices to review derisking cases and issue binding decisions.

  • Fund legal aid for those unjustly de-banked.

Reform Risk Assessment Tools

Problem

Automated risk tools and third-party watchlists often flag people based on identity rather than behavior.

Solution

  • Audit and reform algorithmic risk models to eliminate bias.

  • Ban the use of unverified or discriminatory third-party databases.

  • Introduce government oversight for private compliance software vendors.

Protect Civil Society and Charities

Problem

Muslim-led and international aid organizations are being derisked at alarming rates, disrupting life-saving work.

Solution

  • Provide legal protections and funding transparency tools for registered charities.

  • Prevent financial institutions from closing accounts without cause.

  • Require regulators to publish data on charity-related derisking actions.

Stop Using Derisking as a Catch-All Excuse

Problem

Institutions may misuse derisking as a blanket justification for cutting ties, without proving actual risk.

Solution

  • Require institutions to demonstrate specific compliance concerns before taking derisking actions.

  • Enforce penalties for banks or services that overreach without clear cause.

  • Distinguish between legitimate anti-money laundering (AML) measures and discriminatory practices.