CIBC blames widow after depositing late husband's $15K pension into stranger's account

When longtime Edmonton attorney and retired fellowship margaret court try james iv Koshman died last fall, his family never imagined a simple transfer of his survivor's pension benefit to his widow would go so wrong.

But soon after the $15,000 survivor benefit was issued, the money was gone — deposited into a stranger's account. CIBC blamed the Koshmans, saying they used the wrong transit number — a five-digit code that directs deposits to specific bank branches.

The family was floored. They say that number came directly from a CIBC employee — confirmed during a call to the local branch. 

The Koshmans later discovered CIBC had sent crucial instructions about when to use the transit number, but it went to James's email account — weeks after he died. Another serious blunder, the family says.

Widow takes on CIBC after pension transfer sent to stranger | Go Public

"There's something very wrong about what's going on," said the couple's son, Jason Koshman, who helped his mother apply for the benefit. 

The money should have been moved from Alberta Pensions Services Corporation to one of the Koshmans' CIBC accounts. 

CIBC told the Koshmans it could only recover $3,200 of the misdirected funds — and Yvette Koshman, James' widow, would have to swallow the nearly $12,000 loss. 

What followed was months of back and forth with the bank — until CIBC told the family there was nothing more it could do.

Consumer advocate Duff Conacher, co-founder of the non profit consumer advocacy organization Democracy Watch, says the case reveals troubling gaps in bank accountability — and cracks in Canada's system for handling complaints.

"The marketplace is completely out of balance, tilted totally in favour of the powerful banks who have all the money," he said, "and totally against the customers who are on their own, frustrated, having lost money." 

In an email to Go Public, CIBC says its process for handling complaints is clear and meets all the requirements for financial institutions in Canada. 

See CIBC's full response to Go Public

This all started because the branch where James Koshman had banked for decades was in the process of closing. All accounts were being automatically transferred to another location with a different transit number.

The Koshman's say weeks after they called CIBC and were given the transit number, the bank sent an email explaining that number shouldn't be used until after Nov. 21.

But because the message was sent to James Koshman's email account — after he died — his family says they didn't see it until it was too late. The paperwork had already been filed.

"They know he's passed away. They still sent him emails," said Jason.

Frustrated and out thousands of dollars, the Koshmans tried to resolve things through CIBC's official complaints process — first with CIBC's main customer service department, then escalating to the bank's Client Complaint Appeals Office.

The family got the same response from both: The wrong transit number had been used, only a fraction of the funds could be recovered, and there was nothing more the bank could do.

"I just don't think it's right or it's fair that CIBC can just do what they want," said Yvette Koshman.

The family then escalated the issue to the Ombudsman for Banking Services and Investments (OBSI), which opened an investigation.

CIBC reversed its decision and reimbursed the Koshmans in full — but only after Go Public reached out to the bank. OBSI says that, generally, when a problem is resolved before an investigation is complete, it closes the file. 

Going to the media was the right move, says Conacher, because even if OBSI had ruled in the family's favour, the federal watchdog has no power to force banks to pay.

OBSI can review complaints but can't force banks to follow its recommendations — something the Liberals promised to fix during the 2021 election. Years later, it still hasn't happened.

"It's completely negligent that no federal government, no federal finance minister has done anything to correct this over the past decades," said Conacher.

It seems unlikely the Finance Ministry will change that. In an email to Go Public, it said only that it had recently introduced "guardrails to encourage banks" to follow OBSI's recommendations.

When asked why it twice denied the Koshman's compensation, only to reverse course and compensate the family after Go Public's inquiries. CIBC said, "Given the unique circumstances, and after further review, we've decided to reimburse our client for the remaining amount."

The Koshmans are also frustrated that it appears a stranger was able to keep money that clearly didn't belong to them. 

"It's a fraud," said Yvette. 

Jason says the fact that CIBC recovered some of the missing money suggests the bank knows who received it. But when he asked what steps were taken to hold that person accountable, he said CIBC refused to say, citing privacy laws.

"The bank should be compensating the people whose money was lost and then pursuing the people who… took the money out of the account," Jason said.

Go Public asked CIBC what steps it took to recover the missing money. The bank didn't answer that question, but confirmed it has since apologized and fully reimbursed the Koshmans.

Jason says they're grateful — but worries about others in similar situations who may not be so lucky.

"My family is fortunate," he said. "But what if this was a widow relying on that money to pay rent? To eat? Banks need to be held accountable. And this shouldn't be allowed to happen to anyone else."

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