“It’s about time!” Ontario Bill to Regulate Financial Advisors

hWell it’s about time!”  That’s what Greg Pollock, the President and CEO of Advocis, The Financial Advisors Association of Canada, says about a proposed new bill to regulate financial advisors in Ontario. Bill 157 , proposed by Ontario Liberal MPP Rick Bartolucci, passed first reading on February 18, 2014.  Bill 157 defines a “financial advisor” as a person who engages in the business of providing financial advice. “Financial advice” means advice on investment, financial risk management or financial risk mitigation matters that identifies a client’s financial needs, risks or objectives and establishes strategies to address them.

Bill 157 sets out matters involving, among other things,

  • prohibitions regarding practice
  • registration matters
  • complaints, inspection and discipline
  • conduct and offences

Who is exempt

Bill 157 states the Act does not apply to a person who is:

  1. authorized to practise law in Ontario.
  2. licensed under the Public Accounting Act, 2004
  3. a member of the Certified General Accountants Association of Ontario
  4. a member of the Society of Management Accountants of Ontario
  5. a registered under the Real Estate and Business Brokers Act, 2002
  6. a mortgage broker as defined in the Mortgage Brokerages, Lenders and Administrators Act, 2006
  7. registered under the Registered Insurance Brokers Act.person or class of persons exempted from the application of this Act by the regulations
  8. a person or class of persons exempted from the application of this Act by the regulations

Bill 157 also states the Act does not apply to a person who deals in securities that are exempt from the prospectus requirement under section 73 of the Securities Act (Ontario). This means, for example, registered dealers.

The Ontario Ministry of Finance recently begun a consultation process to assess whether a new regulatory scheme for financial planners is warranted and has engaged in initial roundtables with stakeholders.

Advocis’ video about Ontario’s proposal to regulate financial advisors is set out below as well as some articles from certain pubications.

Advocis VideoGreg Pollock Speaks about New Bill to Professoinalize Financial Advice.

Globe and Mail ArticleOntario MPP Seeks to Regulate Financial Advisors

Toronto StarProposed bill would regulate financial advisors in Ontario

Investment ExecutivePrivate member’s bill proposes new regulatory body to levy penalties and revoke licenses

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This blog is not intended to create, and does not create an attorney-client relationship. You should not act or rely on information on this blog post without first seeking the advice of a lawyer.  This material is intended for general information purposes only and does not constitute legal advice.  For legal issues that arise, the reader should consult legal counsel.

Brian Koscak is a Partner at Cassels Brock & Blackwell LLP located in Toronto, Ontario and Chair of the Exempt Market Dealers Association of Canada. Brian is also a member of the Ontario Securities Commission’s Exempt Market Advisory Committee. Brian can be reached by phone at 416-860-2955, by e-mail at bkoscak@casselsbrock.com or on twitter @briankoscak. Brian also regularly writes about Canadian securities law matters on his personal blog at www.briankoscak.com.

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