Friday 22nd November 2019

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OSC promotes financial literacy, BCSC to get new powers of investigation and enforcement

by Greg Klein | November 1, 2019

That “sociopathic securities regulator,” as Conrad Black called it, has new programs scheduled to help protect investors from, well, other sociopaths. The Ontario Securities Commission will present in-person, online and over-the-phone events throughout November to mark Financial Literacy Month.

People need the tools to make informed financial decisions, and through our financial literacy and investor education activities we’re helping millions of people get smarter about money.—Tyler Fleming,
Ontario Securities Commission

Among them are community seminars, a November 19 telephone town hall, a multilingual website expanded with 16 more languages, a video series, further editions of Investor News and additional resources on the OSC’s consumer website GetSmarterAboutMoney.ca.

“Improving people’s financial knowledge, skills, confidence and behaviour is a key area of focus of the OSC,” said the commission’s Tyler Fleming. “People need the tools to make informed financial decisions, and through our financial literacy and investor education activities we’re helping millions of people get smarter about money.”

Late last month the British Columbia Securities Commission joined the provincial government to announce “sweeping changes” that would give the BCSC “some of the strongest powers in the country.” The proposed legislation would be the first significant amendments of the province’s Securities Act since 2011 and the most extensive since the act became law in 1996.

The new measures would boost maximum fines and prison terms, with minimum sentences applied to some repeat offenders. In some cases the BCSC could impose fines without a hearing. The commission would also gain stronger investigative powers.

OSC promotes financial literacy, BCSC to get new powers of investigation and enforcement

Other measures would allow the BCSC to seize property transferred to third parties, prevent fraudsters from getting a driver’s licence or vehicle plates, and seize registered retirement savings plans.

The commission would also gain stronger control over derivatives trading and corporate transactions.

“B.C. is setting the bar high when it comes to protecting people’s investments,” said Ermanno Pascutto of the Canadian Foundation for Advancement of Investor Rights. “These amendments to improve fine collection rates are some of the most far-reaching in Canada and align with international best practice. We are pleased that the B.C. government and the BCSC will make it a priority to return funds to victims of investment fraud.”

The stronger measures apparently respond to a series of 2017 stories by Postmedia journalist Gordon Hoekstra detailing several cases of unenforced sanctions despite scammers holding significant assets. Over the previous decade the BCSC collected less than 2% of $510 million in fines and payback orders while the OSC enforced about 18% of its penalties, he reported.

“Immediately after the Postmedia investigation, the BCSC filed at least 10 writs of seizure and sale in B.C. Supreme Court for financial fraudsters owing nearly $70 million in penalties, and renewed three enforcement orders, “ Hoekstra wrote in June 2018. “Also following the investigation, B.C. Finance Minister Carole James ordered the BCSC to improve its collection record and called for new tools and modernization of the Securities Act to improve collection.”

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