The Investment Industry Regulatory Organization of Canada (IIROC) published its annual enforcement report for the 2022 fiscal year, highlighting its enforcement activities, including the publication of a full list of hearings conducted and sanctions imposed.

Appeals, IIROC’s legal authority by province and a summary of its enforcement process are also included in the document.

The regulator says four cases reached early resolutions through the use of Early Resolution Offers in 2022. The number of complaints received by IIROC enforcement overall decreased to 1,053, down from 1,396 in 2021. 

Top complaint 

Unauthorized and discretionary trading was the top complaint most frequently reviewed by case assessment, while suitability, due diligence and handling of client accounts was the most frequently cited complaint in concluded proceedings. 

Ontario saw the highest number of investigations completed. IIROC compliance departments were most frequently the referrer in concluded cases. The report also breaks down concluded proceedings by firms and individuals and settlement type.

Total fines 

All told, more than $4-million in fines, disgorgement and costs were imposed by IIROC hearing panels during the year. “The amount individuals were ordered to disgorge increased from prior years, as enforcement continued to focus on ensuring that those who engage in misconduct do not financially benefit,” they write.

Against firms, the regulator levied $1,540,500 in fines and costs in 2022, up from $1,215,000 in 2021. Against individuals, the regulator ordered more than $2,830,529 in fines, costs and disgorgement, up notably from just $976,851 in 2021.

IIROC vice president of enforcement, Charles Corlett, adds that the regulator is always focused on advancing those cases that will contribute most significantly to protecting investors and strengthening market integrity.

Enforcement through courts 

Notably, he adds in November 2021, Newfoundland and Labrador became the sixth province to give IIROC the full enforcement toolkit – that is, the ability to enforce fines through the courts, the authority to collect and present evidence and protection from malicious lawsuits. While the full toolkit is not available in every province, the ability to enforce fine collection through the courts is now available in every province and territory. IIROC collected just 18 per cent of the fines it levied against individuals and 100 per cent of the fines and penalties it levied against firms during the year.

Going forward, the regulator says it will continue to integrate technology into its processes and will continue to focus on shortening the time it takes to reach settlements.