Incorrect jurisdiction of record for locked-in funds
OSFI continues to receive enquiries regarding amounts transferred incorrectly to provincially regulated locked-in retirement savings plans. We would like to remind plan administrators and financial institutions that a federal member’s pension benefit credit must be transferred in accordance with the Pension Benefits Standards Act, 1985 (PBSA) and the Pension Benefits Standards Regulations, 1985 (PBSR), which allow access to the funds only in prescribed circumstances.
When a plan member under federal jurisdiction wishes to transfer their pension benefit credit from a pension plan, that plan member must submit a completed Form 3 of Schedule II of the PBSR (Form 3) to the plan administrator. Form 3 is the application form that indicates the members’ intention to transfer the funds into one of the permitted locked-in savings vehicles under the PBSR along with the financial institution’s signed confirmation of receipt of the member’s request to transfer the funds into a specified vehicle. The financial institution’s signature provides the plan administrator with confirmation that the transfer will be made into an acceptable locked-in savings vehicle. If the financial institution later discovers that the funds were erroneously transferred to a provincially regulated vehicle, then we would expect that financial institution to correct this error and transfer the funds to the appropriate locked-in vehicle.