Saturday, January 27, 2018

Report on IIROC Dealer Account Supervision

This report deals with the issue of account supervision by IIROC registered dealers. We use information observed and documented over the past five years, reports /case studies from the Ombudsman for Banking Services and Investments, independent research, CSA / IIROC reports on compliance, enforcement and compensation practices, IIROC Hearing panel decisions, IIROC Bulletins and feedback from hundreds of Fund OBSERVER readers. In addition, we talked to dealing Reps, former industry participants and lawyers representing clients. The analysis indicates fundamental shortcomings in regulations/rules, supervisory support systems, supervisory cogency, dealer audit practice efficacy, complaint handling practices and IIROC rules/ compliance/enforcement.

We draw attention to root causes and the inherent failure mechanisms. In effect, we have a weak supervisory framework designed for individual brokerage transactions trying to function in an advisory environment whose primary purpose is retirement income security for Canadians. We recommend numerous reforms/ improvements for consideration by IIROC, the CSA and by elected officials. For Report click here 

Tuesday, January 9, 2018

Agravating and Mitigating factors and Associated Issues

We examine IIROC Settlement Agreements along the line of the factors that determine the sanction. Aggravating factors increase the sanction while mitigating factors decrease the sanction. We find that IIROC Hearing panels have a systemic bias towards including mitigating factors while omitting aggravating factors. The result are sanctions that are lower than the evidence suggests they should be. Read the Report here.