Firms must monitor advisors and clients: IIROC report

By Staff | March 31, 2015 | Last updated on March 31, 2015
2 min read

The Investment Industry Regulatory Organization of Canada has released its third annual enforcement report.

The report shows that, in 2014, IIROC imposed fines of $3 million against individuals, and of $224,000 against registered firms. It also:

  • completed 174 investigations;
  • prosecuted 47 individuals and 10 firms;
  • suspended and/or terminated 4 firms, and suspended 21 individuals; and
  • permanently barred 8 individuals from working at an IIROC-regulated firm in a registered capacity.

Read: OSC handed out 2 jail terms in 2014

Last year, cases involving suitability represented the largest number (40%) of regulatory prosecutions by IIROC against individuals. But, at the firm level, it also pursued a number of retail supervision cases.

“Over the past year,” says the report, “IIROC’s detected an increasing number of potential market-related violations by clients of IIROC dealers. Matters involving the clients of IIROC dealers fall outside of IIROC’s jurisdiction and are referred to the relevant CSA jurisdiction, [so] IIROC enforcement has focused on the Dealer Member’s oversight of these client activities, including the adequacy of their supervision of client trading, designed to prevent manipulative and deceptive trading practices.”

Read: Never lend to a client, and other compliance sins

The report also reaffirms one of IIROC’s key priorities will continue to be protection of seniors and vulnerable investors. To assist the investing public, IIROC has begun publishing a quarterly Unpaid Fines Report, which identifies individuals who have not paid the full amount of fines and costs imposed as a result of disciplinary actions.


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