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IIROC responds to CSA review

By Andrew Rickard | March 10 2016 02:13PM

The Investment Industry Regulatory Organization of Canada (IIROC) has responded to our recently published article on the Canadian Securities Administrators’ (CSA) review of its oversight activities.

In a message sent to The Insurance and Investment Journal earlier this week, IIROC's manager of media relations Karen Archer responded to the article we published on March 7 and pointed out that CSA staff found that the regulator "has made sufficient progress in resolving most of the findings in the 2014 report", and says that IIROC is taking steps to address the higher risk areas.

Software upgrade

In particular, IIROC says it has made improvements to its Enforcement Case Management system a priority and has budgeted for the necessary capital expenditure in the fiscal year beginning April 1, 2016. "In the interim, IIROC has implemented compensating controls until the necessary software upgrade can be made. IIROC’s actions will help ensure our Enforcement remains fair, impartial and effective," reads the message.

Archer adds that IIROC's board of directors "at all times receives comprehensive and timely information" concerning the implementation of the regulator's information security plan, and that the organisation "remains committed to strong information security".

Suitability of investment recommendations

Finally, the message from IIROC points out that its Business Conduct Compliance team has made a number of changes in examination procedures to do a more thorough job of testing the suitability of investment recommendations at IIROC-regulated firms. IIROC says it will continue to improve its compliance program to reflect changes in markets, risks, investment products, and demographics to focus on priorities such as suitability.

"In this latest review, CSA staff acknowledged these actions and all other IIROC responses to the findings," concludes the e-mail from Archer. "We will continue to strengthen our capabilities to deliver on IIROC’s regulatory priorities, which remain focused on protecting investors, promoting compliance and fostering fair and efficient markets across Canada."

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