IIROC Issues 2013 Enforcement Report - Continued Focus on Seniors and Suitability
TORONTO, April 15, 2014 /Canada NewsWire/ - The Investment Industry Regulatory Organization of Canada (IIROC) today released its second annual Enforcement Report which demonstrates its continued focus on key strategic priorities, including misconduct relating to seniors and suitability.
Consistent with previous years, cases involving seniors represented more than one third of all IIROC's disciplinary cases. Unsuitable investments were the most common complaints investigated in 2013, representing over 40% of IIROC's disciplinary actions. The vast majority of cases involving seniors dealt with suitability violations relating to the risk profile of an investment itself, failure to meet the "know- your-client" obligation and/or the improper use of leverage.
"This annual report contains a comprehensive overview of IIROC's enforcement priorities, initiatives and processes, and highlights important enforcement cases that underscore our ongoing efforts to enhance investor protection and foster fair and efficient capital markets," said Susan Wolburgh Jenah, IIROC President and Chief Executive Officer.
"This year we pursued important policy initiatives designed to refine our processes and improve our effectiveness through rule changes and revised sanction guidelines," said Paul Riccardi, Senior Vice President, Member Regulation. "We continue to dedicate IIROC's enforcement resources to actively prosecute wrongdoers and to focus on harmful behaviours that warrant enforcement action."
In 2013, IIROC took significant measures against a number of firms including expedited disciplinary actions to suspend, terminate and/or oversee their wind-down in order to protect the investing public.
In 2013, IIROC:
initiated 200 investigations
successfully prosecuted 45 individuals and 12 firms
suspended and/or terminated 5 firms and suspended 25 individuals
permanently barred 8 individuals from working at an IIROC-regulated firm in a registered capacity
imposed fines of nearly $4.4 million against individuals and $2.2 million against IIROC-regulated firms (the fines against firms represent a 63% increase year-over-year)*
*In May 2014, IIROC will begin to publish the names of individuals who have failed to pay outstanding fines on its website.
In keeping with IIROC's commitment to transparency and accountability, updated Enforcement Reports will be published annually. Print copies are also available upon request.
IIROC is the national self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada. Created in 2008 through the consolidation of the Investment Dealers Association of Canada and Market Regulation Services Inc., IIROC sets high quality regulatory and investment industry standards, protects investors and strengthens market integrity while maintaining efficient and competitive capital markets.
IIROC carries out its regulatory responsibilities by creating and enforcing rules regarding the proficiency, business and financial conduct of dealer firms and their registered employees and through the creation and enforcement of market integrity rules regarding trading activity on Canadian marketplaces.