Starting next month, dealers will have to comply with new requirements when reporting complaints and other events, such as lawsuits and in-house investigations, to the Complaints and Settlement Reporting System (ComSet).
The Canadian Investment Regulatory Organization (CIRO) published new guidance detailing ComSet reporting requirements, which will take effect on Nov. 1. That’s when fund dealers will begin reporting to ComSet — the system that was originally developed for investment dealers.
Once that transition is complete, dealers will be required to attach specific supporting documentation when filing ComSet reports. The guidance sets out the specific requirements for various events, such as client complaints, internal investigations, civil claims, and criminal charges, along with allegations of theft, fraud and other serious misconduct.
“Providing the documents and information will allow CIRO staff to conduct more timely and efficient reviews of ComSet filings,” the guidance said. It added that the new documentation requirements are “also expected to result in fewer requests by CIRO staff for additional information.”
The self-regulatory organization also provided guidance on complying with other aspects of the ComSet reporting system, such as the deadlines for reporting certain events. It also clarifies firms reporting obligations.
For instance, it says that while complaints about dealer service issues generally don’t have to be reported to ComSet, complaints about account transfers do have to be reported — as they are subject to the SRO’s rules, and could involve potential rule breaches.
It also clarifies that firms don’t need to make a separate report about an internal investigation that follows a complaint that has already been reported — unless that investigation broadens to other issues.