June 9, 2020 (Toronto, Ontario) – In early February, the MFDA published its comprehensive policy analysis of the SRO framework, A Proposal for a Modern SRO: A Special Report on Securities Industry Self-Regulation, which outlined the path towards real, lasting change in the public interest.
In reading IIROC’s position paper, it is clear that their proposal is meant to benefit only industry, not investors or the public. Canadian investors deserve better. Canada deserves better.
Any serious revision of Canada’s SRO framework that is truly focused on the public interest needs to address the issue of public confidence. That means addressing the conflict of interest concerns that exist between the mandates of SROs and the interests of SRO members. The MFDA Special Report addresses these issues through important governance changes that include amplifying the role of the Canadian Securities Administrators (CSA) – the country’s statutory securities regulators – in the governance of SROs.
The MFDA Special Report sets out a framework for a new SRO that is built from the ground up to allow for a truly modern SRO with a culture that puts the public interest first. It can be flexible, nimble and developed through a scaled approach—efficiently and cost effectively. With leadership and vision, this new SRO—committed to the public interest—is entirely achievable.
Only by designing a net new SRO – that addresses the interests of all stakeholders in a fair and balanced manner – can we create a system which delivers lasting benefit for Canada. The time for real change is now. We cannot allow this to be a missed opportunity to improve the state of regulation in Canada. The MFDA looks forward to further collaborating with the CSA, IIROC and all stakeholders towards our collective goal of a lasting solution which is beneficial to all Canadians.”
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its Members and their approximately 81,000 Approved Persons with a mandate to protect investors and the public interest. For more information about the MFDA’s complaint and enforcement processes, as well as links to ‘Check an Advisor’ and other Investor Tools, visit the For Investors page on the MFDA website.