Investment watchdog gains new powers
The regulator of investment dealers across Canada is set be granted the power to compel evidence and co-operation in its investigations from third parties including banks and phone companies.
Andrew Kriegler, chief executive of the Investment Industry Regulatory Organization of Canada, said legislation introduced in Alberta on Monday would give the self-regulatory agency powers he hopes will be adopted across Canada.
“There’s a pretty darn good sense of momentum,” Kriegler said in an interview, noting that Prince Edward Island and Ontario recently followed Alberta and Quebec with plans to grant IIROC legal authority to collect fines through the courts.
“I think it’s a sign governments across the country and their securities commissions are committed to investor protection,” he said.
Dealers and advisers registered with IIROC can already be compelled to co-operate with the self-regulatory agency’s investigations, but the new powers included in the Alberta legislation would extend the reach to third parties such as financial institutions and telecommunications companies in the province.
“If you’re trying to find out whether or not funds were misappropriated, it certainly helps if you can follow the trail of the funds,” Kriegler said, adding that phone and financial records “complete the story” for investigators.
“There certainly have been cases in the past across the country where we’ve hit effectively a dead end, not being able to get the information to tell whether or not there’s a real case there. So this will reduce that.”
The new legislation, which was introduced by Alberta Finance Minister Joe Ceci, is intended to provide the agency that oversees investment dealers in the province with a similar suite of investigative tools wielded by provincial securities regulators to police their corner of the capital markets. It also includes provisions to protect IIROC staff and disciplinary tribunals from lawsuits stemming from “good faith” investigations, a protection that is already available to provincial securities regulators.
Ceci said in an interview the government hopes to have the new law passed by early June.