Legal and Regulatory Affairs

Advocis comments on the Ontario Securities Commission’s draft Statement of Priorities for 2019-2020. We discuss: the need to identify, measure and address regulatory burden, pointing to cost-benefit analyses, outside business activities, the client-focused reforms and the role of regtech; how to improve retail investors’ experience; our support for the Capital Markets Regulatory Authority; and the role of innovation and fintech.

Advocis commends the Government of Ontario’s commitment to reviewing the regulatory oversight of financial advisors and planners in the province. We discuss how the Government’s vision aligns with Advocis’ 2018-2022 strategic plan and commitment to advance the value and professionalism of advisors, in the best interest of consumers.

Advocis understands that certain mutual fund sales practices can be misapplied by unprofessional advisors and this problem needs to be addressed. But the outright elimination of the DSC option would be the incorrect policy response. DSC is a tool; it is not inherently problematic and should be preserved as an option. Instead, there are better ways to strengthen consumer protection.

The CSA’s client-focused reforms are promising, but they would be layered upon a product-based framework that does not reflect modern advice-giving. The reforms are also too narrowly focused on costs, and not value. The handling of conflicts of interest and disclosure require greater clarity. And the CSA’s approach to referral arrangements needs a complete re-think.