Earlier this week, the Investment Industry Regulatory Organization of Canada released its Enforcement Report for 2013, which covers IIROC's enforcement activities and key policy initiatives for last year.
According to IIROC, enforcement priorities in 2013 included focusing on the protection of seniors and vulnerable investors, unsuitable investment recommendations and firms' supervision of retail operations. In relation to the market activities, IIROC's enforcement focus was on the identification, investigation and prosecution of cases involving manipulative and deceptive trading (including such practices as wash trading, spoofing and layering).
Ultimately, IIROC conducted 200 investigations in 2013 across Canada. The regulatory violations most prosecuted against individuals related to due diligence, handling of client accounts and suitability. Inappropriate personal financial dealings, discretionary trading and off-book transactions also garnered a number of prosecutions. In the case of firms, prosecutions were most likely in relation to concerns over supervision and capital deficiencies. Sanctions against individuals and firms totaled almost $8 million.
In respect of policy initiatives and developments, the report highlights IIROC's project to consolidate its enforcement rules, its draft sanction guidelines, and its efforts to collect fines and cost awards, which include new legislative powers in Quebec to facilitate enforcement of IIROC's disciplinary decisions in the province and the authority to enforce cost orders in Ontario in light of a 2013 Superior Court decision. IIROC also states that it intends to begin publishing on its website a list of disciplined individuals who are delinquent in the payment of monetary sanctions.