Last autumn, the Mutual Fund Dealers Association of Canada (MFDA) sought comments on its proposal to regulate the use of the “financial planner” title among the individuals registered with MFDA dealers. There has been support for years for the idea of moving away from the status quo, in which anyone outside Quebec can call themselves a financial planner.

But there often is disagreement on exactly how to regulate this title – and the MFDA appears to have received a good dose of both supportive and critical comments.

The MFDA’s proposal brought back memories of past efforts to regulate financial planning, financial planners and/or titles.

The Investment Industry Regulatory Organization of Canada (IIROC) proposed an ambitious rule several years ago. IIROC was going to set standards for investment advisors who provide financial planning services; develop written policies and procedures; create data-gathering forms and letters of engagement; and spot-review financial plans. At that time – before the worst of the bear market – I thought that IIROC was biting off more than it could chew.

Reaching further back into my memories, there lurks multilateral Instrument 33-107. This was an Ontario Securities Commission (OSC) initiative that was to be adopted by a couple of other provinces initially. The OSC proposed creating a whole regulatory regime around all aspects of financial planning (legal/regulatory standards; the activities; the titles; creation and testing of exams; proficiency; etc.). The proposal looked all but ready to go – despite many objections. Then it just faded away, never to be heard from again.

Elegant measure

The MFDA’s proposal is a simpler and more elegant measure. I didn’t realize that at first, but this proposal is exactly what I recommended as a first step in my 2014 submission to the Ontario Ministry of Finance’s financial planning consultation. I suggested linking the use of titles to individuals active in financial planning and choosing one or two key designations as qualifiers and adopting their respective codes of ethics and conduct.

As a certified financial planner, I would prefer a more comprehensive but sensible regulatory model akin to what the Financial Planning Coalition is endorsing. This group, consisting of the Financial Planning Standards Council and three other financial planning groups, endorses the creation of a new regulatory body focused solely on the creation, oversight and enforcement of financial planning regulation.

The MFDA’s proposal is not ideal because it will affect only a segment of the people presenting themselves as financial planners, resulting in further fragmentation. And there appears to be real momentum in Ontario’s initiative to move forward with some form of financial planning regulation. But that will take years.

And given how long this issue has been debated – and that many attempts at regulation have been lobbied into extinction – I would say that an imperfect start is better than the status quo. If nothing else, the MFDA’s proposal will help add to the momentum started in Ontario and help to move that initiative across the goal-line.

If the progress of the second phase of the client relationship model is any indication, the time for financial planning regulation has arrived. The momentum could push financial planning toward “profession” status.

Dan Hallett, CFA, CFP, is vice president and principal with Oakville, Ont.-based HighView Financial Group, which designs portfolio solutions for affluent families and institutions.



Read the response from Advocis to this column: Extend “profession” status to all advisors,, March 18, 2016.


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