It turns out that publicly shaming violators of provincial securities laws is an exceptionally poor way of collecting unpaid penalties but some Canadian regulators say they will continue to operate the websites anyway.
In the five years since the Ontario Securities Commission (OSC) launched its "delinquent respondents list," a website page designed to expose violators of securities law who haven't paid their fines and other sanctions as ordered, only 16 of 432 names have been removed — 13 because they paid up and three because they've started payment plans.
Similarly, two years after the Alberta Securities Commission announced it was posting the names of violators of securities laws who don't pay, a total of eight debts for about $525,000 have been collected.
That leaves almost half a billion dollars owed by nearly 600 names since 2005 between the two lists as of June.
Not even the commissions agree on whether the sites are effective, fair or worthwhile — only five of the 10 provincial bodies use them.
"Fining somebody and banning them from the markets — when they weren't operating in the markets in the first place legitimately, and fining them when you know they're never going to pay — doesn't really do much," said Marian Passmore, director of policy for the Canadian Foundation for Advancement of Investor Rights.
She said her organization would like to see more criminal proceedings in financial crimes such as fraud.
"Putting them in jail, there's a real deterrent."
Canada's provincial securities commissions concede that many people sanctioned for scams, pyramid schemes, dishonest marketing or simply failing to follow provincial financial procedures won't pay their penalties.
But they say naming them online is worthwhile because it offers vital information to investors and is a low-cost way to encourage at least some violators to pay up.
"It's kind of a name-and- shame that puts miscreants under the spotlight," said James Sinclair, general counsel for the OSC, Canada's largest securities regulator.
He said the commission is trying to work with police to put more fraudsters in criminal courts where they face possible jail sentences.
It has also launched a new program to use an outside legal firm to pressure people to pay. And it has recently forced three companies with outstanding unpaid sanctions into bankruptcy, he said.
"There's no guarantee any of this will work — we have respondents who regularly lie about their assets, hide them offshore, put them in their wives' or children's names, making it all the more difficult to go after them," Sinclair said, conceding that the OSC's budget to enforce collections is limited.
Likewise, securities violators who can escape to another jurisdiction or change names to start a new venture likely don't care if their names are sullied on securities commission websites.
However, those who stick around say the shaming does cause real hardship.
Two men named for unpaid sanctions — both small business owners — contacted by The Canadian Press would speak only on the condition of anonymity, explaining their reputations can't take any more damage by being mentioned in this article.
"I'm trying to get my life back together. This is going to follow me to my obituary," said one, adding his securities violation record pops up whenever a new business contact Googles his name.
"It's a process and I'm stuck in that process," said the other. "I just want to make myself solvent and good and be able to come out of all of this."
In Ontario, Alberta and Saskatchewan, names on the unpaid orders lists are erased when the debt is paid, but in British Columbia and Nova Scotia, the names remain and the agency adjusts the status from unpaid to partly paid or fully paid when money comes in.
"I think it's important out of fairness that it's publicly known the respondent has paid the sanction," said Doug Muir, director of enforcement for the B.C. Securities Commission, who said its list has existed for more than 10 years.
The B.C. commission's roster of unpaid respondents has climbed by 122 names to 328 in the past five years while its paid list has grown by just 59 names to 454. It said it could not provide a dollar value for either category.
In Quebec, meanwhile, the Autorité des Marches Financiers is currently evaluating adding a delinquent accounts website page, said spokesman Sylvain Theberge. He said the AMF first wants to ensure such a page will better inform investors — and result in a collections boost.