IIROC focuses on suitability, technology

The Investment Industry Regulatory Organization of Canada has released an updated Strategic Plan, aimed at investor protection, improving its use of technology and how the regulator reacts to unexpected events.

“Our revised Strategic Plan will guide us in providing efficient, cost-effective regulation while responding to important changes in the industry and markets we regulate,” said Susan Wolburgh Jenah, IIROC president and CEO.

Under the new Strategic Plan, IIROC will implement its Client Relationship Model to improve transparency in the area of fees, advisor conflicts and account performance. This move would be contingent upon approval by the Canadian Securities Administrators.

The SRO will also enhance its compliance and enforcement efforts with respect to suitability, focusing on issues relating to seniors.

On a related issue, the regulator will sharpen its focus on the fixed income market, implementing a fair pricing rule for fixed-income and other over-the-counter securities, again, subject to CSA approval.

On the technology front, IIROC acknowledges that the increased speed of trading and complex strategies have posed a challenge for regulation. In response, it will implement the recommendations adopted in the aftermath of the May 6, 2010 “Flash Crash” in order to enhance market stability.

The SRO’s own use of technology will get a boost, with the implementation of its Surveillance Technology Enhancement Program, which allows cross-market monitoring and analysis of all equity markets in Canada

The Strategic Plan is in effect for the period through 2012.

For more on the Flash Crash, read:

• Can a flash crash happen again?

• The limits of liquidity

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.