The Investment Industry Regulatory Organization of Canada (IIROC) published its annual Enforcement Report, May 11. In it, the regulator publishes its annual list of disciplined individuals and firms, discusses the year’s enforcement activities, including a summary of financial penalties, and highlights a selection of cases that were concluded during the year.

“Enforcement pursued a variety of cases, including novel trading and gatekeeping cases. However, suitability continued to be a core focus, representing approximately a third of prosecutions and all matters reviews by case assessment,” the report’s authors write. “Seniors and vulnerable clients remain a key demographic for IIROC, representing one quarter of matters reviewed, and almost a third of prosecutions.”

The top three complaints

According to the report, the top three complaints reviewed by case assessment involved unsuitable investments 31 per cent of the time, unauthorized and discretionary trading 21 per cent of the time and supervision issues eight per cent of the time. IIROC received 921 complaints from ComSet, IIROC’s Complaints and Settlement Reporting System, during the year, 184 complaints from the public, 21 complaints from other IIROC departments, 15 complaints from other Self-Regulatory Organizations (SROs) and commissions, and seven other complaints, for a total of 1,148 complaints during the year. The regulator completed 104 investigations and prosecuted 28 individuals and eight firms.

Monetary sanctions

Total monetary sanctions imposed in 2019 include $1,835,000 worth of fines, costs and disgorgement ordered against eight firms, and $1,979,071 worth of sanctions imposed in total against 28 individuals. The numbers are an increase over the $915,500 imposed against firms in 2018, but a notable decline in penalties compared to the $3,243,712 imposed against 42 different individuals in 2018. IIROC was able to collect 97 per cent of fines from firms in 2019, but only 29 per cent of the fines it issued against individuals.