Enforcement sanctions imposed by the Investment Industry Regulatory Organization of Canada (IIROC) against both industry firms and individual reps rose in fiscal 2022, according to the self-regulatory organization’s latest annual enforcement report.
The SRO reported that it levied $2.8 million in monetary sanctions against reps last year, up from less than $1 million in the previous year.
Fines against reps rose to $2.1 million from less than $800,000 in fiscal 2021. Disgorgement orders more than doubled: to over $211,000 from less than 90,000. Costs orders jumped to almost $500,000 from $121,500.
The surge in penalties against reps reflected a slight increase in decisions — 23 in fiscal 2022 compared to 21 the previous year.
IIROC noted that the jump in disgorgement orders came amid an increased effort to ensure that rule violators don’t benefit financially from their misconduct.
Sanctions against industry firms also rose year over year, albeit modestly.
Total monetary sanctions imposed against firms edged up to $1.54 million in fiscal 2022 from $1.2 million in 2021.
However, for the second straight year, there was no disgorgement ordered against firms.
Fines for firms ticked up to $1.37 million from $1.1 million, and costs orders were slightly higher too.
“This past year, we continued to focus on pursuing impactful cases to prevent and deter misconduct and improve industry standards,” said Charles Corlett, vice-president of enforcement with IIROC, in a release.
“We pursued enforcement proceedings that addressed a wide range of conduct, always focused on advancing those cases that will contribute most significantly to protecting investors and strengthening market integrity,” he said.
IIROC reported that its fine collection rate for individuals was 18% in fiscal 2022, down from 60% the year prior and 79% in fiscal 2020. IIROC typically collects all of the fines imposed on firms, and indeed its collection rate for firms since fiscal 2019 has been 100%.