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Regulators intend to create national database that tracks advisor misconduct

By Susan Yellin | February 19 2013 08:42PM

The Canadian Council of Insurance Regulators (CCIR) and the Canadian Insurance Services Regulatory Organizations (CISRO) have agreed to move ahead on creating a single national database of insurance advisors who have been disciplined for some kind of misconduct.Currently, a consumer who wants to search out the regulatory history of an advisor must sift through each provincial insurance regulator’s website to find the information – if it’s there at all.

Of particular concern is that the information may only be available in an advisor’s home jurisdiction even though the advisor may be registered in a number of provinces.

Now CCIR and CISRO, which represent various provincial insurance and other regulatory authorities, have decided it’s time for consumers to have a single gateway to get this material.

“The purpose of this initiative is to ensure the public has relatively easy access to information on intermediaries who have had some sort of enforcement sanction,” said Shonna Neil, senior manager of licensing at the Financial Services Commission of Ontario (FSCO) and co-chair for CCIR.

“There will be some challenges,” notes Ms. Neil, because not all regulators are alike in what they post.
FSCO, for example, posts cease and desist orders and provides an online search for records of enforcement actions it has taken on those in the insurance, mortgage brokering, credit union, caisses populaires and loan and trust corporations, in addition to other information.

Alberta, however, has not been posting any disciplinary action. But Tom Hampton, chief operating officer of the Alberta Insurance Council, now says it has received the appropriate ministerial approval and will begin publishing this information on a go-forward basis as of April 1.

“If it’s a disciplinary action we will publish because it’s in the public interest to know,” said Mr. Hampton.
Ms. Neil said the intent of the national database is to get it done as quickly as possible. As of the end of January, officials were sketching out a preliminary plan.

Advocis, the Financial Advisors Association of Canada, stated recently that it was in favour of the creation of a central database for tracking substantiated complaints of advisor misconduct. Doing so would eliminate existing reporting gaps between sectors and increase consumer confidence, stated the Advocis brief.

Meanwhile, Alberta is moving ahead in the next few weeks with a provincial database that will include the name of the advisor with “unique identifiers,” which will apply to advisors who register in multiple jurisdictions. A new advisor, for example, will sign in to register and will be assigned a number and include this in information in his home jurisdiction. Alberta will then notify all the jurisdictions that this person has been registered.

“This will narrow down the confusion of who is who when advisors sign up for multiple jurisdictions,” said Mr. Hampton. “Having the identifier number is the starting point.”

He said discussions have taken place with other provinces as to whether and when they want to join with Alberta on this. Alberta’s database will include advisors who sell life, accident and sickness, property and casualty advisors as well as adjusters.

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