Alberta has introduced legislation that aims to beef up securities enforcement by giving the investment industry’s self-regulatory organizations (SROs) greater investigative powers and statutory immunity.
The proposed law would give the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA) the power to compel evidence, including the authority to require witnesses to give testimony under oath, and the ability to compel the production of documents and records. Under the proposed amendments, refusing to comply with the SROs’ demands could amount to contempt of court.
In addition, the proposals would give the SROs’ personnel statutory immunity from civil liability for enforcing the securities laws in good faith —a legal cover that the SROs have long sought.
“With these legislative changes, Alberta becomes the first province in Canada to provide IIROC with a complete toolkit, enabling us to more effectively fulfil our responsibilities as a public interest regulator and bring wrongdoers to justice,” says Andrew Kriegler, president and CEO of IIROC, in a statement.
Seniors advocacy group, CARP, also supports the proposed changes. Says Wanda Morris, vice president of advocacy at CARP: “We welcome today’s announcement as a critical step in bringing rule-breakers to justice and deterring wrongdoing, thus better protecting investors in this province. We look forward to additional, practical steps like this from the government of Alberta.”
The head of Prosper Canada, a charity that seeks to improve economic opportunities for poor Canadians, Elizabeth Mulholland, suggests that other governments should adopt similar changes.
“We applaud the government for strengthening IIROC’s ability to investigate and prosecute wrongdoers in Alberta and hope other provinces will follow suit so that all Canadians can enjoy the same protection,” Mulholland says.
Alberta Finance indicates that “Similar changes are planned by other jurisdictions, including Quebec”; and that these efforts reflect the department’s “commitment to work with other jurisdictions to reform Canada’s securities regulatory system.”
“Our government is making practical changes to ensure that our province’s securities laws are enforced, so Albertans can have confidence in the financial services industry knowing that they’re held to a high standard,” says Joe Ceci, president of Treasury Board and Minister of Finance in Alberta, in a statement.
These proposals follow a recent commitment from Ontario’s government to give IIROC and the MFDA the power to enforce their disciplinary fines in court, which they already enjoy in Alberta and Quebec.
Read: Ontario to give SROs power to collect fines against advisors in court
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