IIROC has 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 year we pursued important policy initiatives designed to refine our processes and improve our effectiveness through rule changes and revised sanction guidelines,” says 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; and
- 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.