Financial advisors are facing “a perfect storm” of regulation, with an intense focus on regulatory initiatives such as the second phase of the client relationship model (CRM2) and point-of-sale disclosure, according to Rebecca Cowdery, a partner with Borden Ladner Gervais LLP in Toronto.

“There are so many different layers of regulations, so many things going on,” said Cowdery at the Canadian Institute of Financial Planners’ (CIFPs) annual conference in Vancouver on Thursday. “I have been following securities regulation for many years … but I’ve never seen anything like what we’re in right now.”

One of those layers — international financial services regulation — is playing an important part in the discussions that Canada’s provincial securities commissions are having. For example, the move to ban commissions in the U.K. and Australia has Canadian regulators pondering the same move.

“It’s kind of seductive for a regulator to see what’s happening by very thoughtful and powerful regulators in the U.K. and the Australian government,” said Cowdery.

Canadian regulators are awaiting a report from Douglas Cumming, professor of finance and entrepreneurship and Ontario research chair in economics and cross-cultural studies at York University’s Schulich School of Business in Toronto, before taking the next step.

In September 2014, the Canadian Securities Administrators (CSA) announced Cumming would explore whether trailing commissions paid by mutual fund managers to dealers influence the sales of certain funds. To determine this, Cumming is using a representative sample of investment data provided by investment fund managers.

Cumming’s report is expected to come out later this spring or summer, Cowdery said, and it will play a part in the regulators’ decision concerning the status of commissions in mutual fund sales.

Said Cowdery: “The [provincial securities] commissions will say that they have not made up their minds and I actually believe them — they haven’t made up their minds.”

Another important element contributing to the intense level of regulatory activity is the rise of influence from credible investor advocates, such as the Canadian Foundation for Advancement of Investor Rights (a.k.a. FAIR Canada).

When Cowdery worked at the Ontario Securities Commission in the 1990s and early 2000s, there were only a few individuals who could be considered as investor advocates — and those individuals were generally disregarded, as their opinions were extreme, she recalled. Today, however, investor advocates have the ears of securities regulators.

“Now we’ve got very well-written [articles] and very articulate people who are standing up, in their words, for investors,” she said.

But she said securities commissions do not seem to be reaching out to industry associations, such as the CIFPs, in the same way, Cowdery said.

“[Securities commissions] seem to discount some of the comments that come from the industry,” she said. “I sometimes feel we have lost the balance between listening to the investor advocates and listening to the industry.”