tax inspector investigating financial documents through magnifying glass, forensic accounting or financial forensics, inspecting offshore company financial papers, documents and reports.

The Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA) have proposed two possible models for SRO reform, but provincial regulators aren’t necessarily planning for SRO consolidation, Canada’s top regulator cautions.

Speaking at an online event hosted by law firm McMillan LLP on Tuesday, Grant Vingoe, acting chair and CEO of the Ontario Securities Commission (OSC), indicated that the forthcoming consultation on the self-regulatory structure by the Canadian Securities Administrators (CSA) doesn’t necessarily indicate that SRO consolidation is in the cards.

Vingoe said that the CSA’s paper on SRO reform, which is expected shortly, will focus on the underlying issues with the existing SRO framework and how to resolve them. Consolidation is not necessarily the answer, he suggested.

Already this year, IIROC and the MFDA have put forward their competing visions for SRO reform.

IIROC imagines a straightforward merger with the MFDA, whereas the MFDA has proposed creating a new SRO to oversee all registered firms, while spinning off market regulation into a separate entity.

In his remarks, Vingoe indicated that the CSA’s consultation won’t simply be an exercise in weighing those competing visions. Instead, the CSA will undertake a more in-depth analysis of the underlying SRO structure.

If the CSA determines consolidation is the ideal solution, provincial regulators will consider how that should be structured, and how the statutory regulators would fit into the new scheme, Vingoe indicated.

In addition to the SRO reform consultation, Vingoe suggested that the Ombudsman for Banking Services and Investments (OBSI) is another area that needs action.

While he didn’t specifically commit to providing OBSI with binding authority, Vingoe suggested that the current OBSI structure is flawed, in that it can be very time-consuming for investors, who aren’t assured of reaching a satisfactory resolution.

“We need to fix the situation so that it’s an efficient process for everyone and [it] achieves a promise that investors will get redress when there have been regulatory violations or unfairness,” Vingoe said.

Additionally, Vingoe noted that securities regulation in Ontario is undergoing its own review by a provincial government task force. He said that the OSC is looking forward to the task force’s recommendations and to working with the task force and the provincial government on implementing reforms.

In the meantime, Vingoe noted that the OSC is continuing to move ahead with the burden reduction recommendations produced by its own task force last year, and that it’s close to completing some of the more significant reforms that involve other members of the CSA.

Internally, reforms to the OSC’s own procedures, service standards and its cost/benefit analysis process will also be some of the most substantial reforms coming out of the burden reduction effort, Vingoe suggested.