Weekly Wrap: From the Regulators

Weekly Wrap: From the Regulators

Weekly Wrap: From the Regulators IIROC shelves proposed financial planning rule
Ontario’s provincial government is mulling over the possible regulation of financial planning, something that has already been implemented in other provinces. As a result, IIROC has decided to withdraw a rule it originally proposed in 2008. The rule would have made it mandatory for reps that bill themselves as financial planners to meet certain proficiency and supervisory requirements.

Smaller firms offered fee relief from OSC
The Ontario Securities Commission (OSC) is making a temporary cut to the fees paid by smaller firms and issuers, a move that will lighten the burden on the smaller players within the market. In particular, the provincial regulator said that it will provide one-time relief on its participation fees for small registered firms and reporting issuers.

CSA enforcement decreased in 2013
Recently-released data from the CSA’s sixth annual enforcement report CSA’s sixth annual enforcement report shows that enforcement from Canada’s regulators fell in 2013.
According to the report, the CSA was involved in 112 cases last year, which involved 160 individuals and 110 companies. This is a considerable decrease from the 145 total proceedings in 2012, involving 242 individuals and 146 companies.

Report shows that complex financial regulation is misguided
A new report from the C.D. Howe Institute argues that efforts being made to increase bank regulations in the wake of the financial crisis are flawed.
The report urges policy-makers to decrease risk by reintroducing certain elements, which include shareholder liability and a limitation placed on deposit insurance.

IIROC issues guidance on 'borrow-to-invest' strategies
IIROC released guidance notes on Wednesday for dealers and advisors, who offer leverage (borrow-to-invest) strategies for their retail clients, alongside a bulletin intended to warn investors. The national regulator has noticed a high number of instances where “inappropriate” leverage strategies are being used by retail investors. Additionally, IIROC says clients need to be made aware of the risks associated with leverage strategies and the debt-payment obligations incurred if exercised.

Private members’ bill would regulate Ontario advisors
A member of the Ontario Liberal party tabled a private members’ bill on Tuesday that would regulate the activities of financial advisors in Ontario. The proposed bill would establish the Financial Advisors Act, 2014, if it takes effect. It would apply to all fee- or commission-based advisors within the province, regardless of what types of products they sell to their clients.