Financial Planners and Financial Advisors Consultation Summary Report

• IFB

The stakeholder was generally supportive of the proposed key activities for the sector.

FSRA thanked the stakeholder for its submission and support for the key deliverables included in the proposed 2024-2025 Statement of Priorities and Budget.

• FAIR Canada

The stakeholder noted concerns with FSRA’s ability to deliver meaningful consumer protection in the FP/FA sector due to the limited scope of the framework.

FSRA is implementing the framework within the scope of the existing legislation.

As stated in FSRA’s 2023-2026 Annual Business Plan (“ABP”), FSRA has committed to conducting a review of the framework and is in the process of supervising credentialing bodies (“CBs”) on key issues. Findings from these activities could result in amendments / enhancements to the framework and/or for CBs to improve their protection of consumers.

• FP Canada
• IFB

Stakeholders noted that FSRA’s ability to provide robust oversight of CBs was essential to ensure that consumers have confidence in the individuals with the FP and FA titles.

Stakeholder recommended a risk-based approach to compliance and urged FSRA to ensure its supervision plans would not impose undue burden on CBs that have demonstrated compliance with FSRA’s requirements.

FSRA thanks stakeholders for their comments.

FSRA supervised CBs through various tactics, including the Annual Information Return, onsite examinations and thematic reviews, as needed. FSRA’s supervisory focus for CBs in 2023-24 included complaint handling and disciplinary processes and putting the client’s interests first.

FSRA is a risk-based regulator and will utilize this approach when developing its future supervision plans for the FP/FA sector.

• FAIR Canada

FSRA should seek additional enforcement authority from the Government of Ontario to enable FSRA to take direct enforcement action against credential holders (title users) that harm consumers.

FSRA thanked the stakeholder for its submission.

FSRA will continue to monitor compliance with the framework and work with the Government of Ontario to identify potential opportunities for enhanced enforcement.

• FP Canada
• FAIR Canada

Stakeholders were generally supportive of harmonized standards across Canadian jurisdictions implementing title protection frameworks.

Stakeholder noted that FSRA should address concerns regarding the FA minimum standard and the new Fee Rule before pursuing harmonization efforts.

FSRA thanked the stakeholders for their comments and their shared goal to harmonize standards.

FSRA will consider this feedback as it continues to implement the title protection framework.

• FP Canada
• FAIR Canada

Stakeholders were deeply concerned about the provisions in the new FSRA Fee Rule, which exempted the Canadian Investment Regulatory Authority (“CIRO”) from paying its fair share of costs associated with its participation in the title protection framework.

Stakeholders recommended that FSRA review its cost allocation for the sector and ensure the $25,000 annual fixed fee charged to CIRO would be sufficient to cover other common costs.

The stakeholder recommended that costs associated with any non-compliance activity related to a CB should be borne exclusively by that CB.

Stakeholder noted that FSRA’s proposed budget for the sector did not reflect the identified priorities and urged FSRA to allocate greater regulatory resources to accomplish these goals.

Stakeholder recommended FSRA formalize its “nexus to Ontario” criteria within the Financial Professionals Title Protection Rule (FPTP Rule) or Guidance.

FSRA thanked the stakeholders for their comments.

As a regulatory body, CIRO would be subject to robust oversight of its governance, administration, operations and other regulatory responsibilities conducted by the Ontario Securities Commission (“OSC”) and the Canadian Securities Administrators (“CSA”). While CIRO would be subject to FSRA oversight under the framework, requiring it to pay for activities/work already conducted by the OSC and CSA would result in regulatory duplication.  Having CIRO as a CB will materially lower the charges to other CBs related to establishing the CB framework.  While $25,000 remains FSRA’s best estimate of the minimum fee a CB should pay for ongoing oversight (and notes this minimum amount was consulted on and finalized before CIRO indicated an interest in becoming a credentialing body), this amount will be reviewed when FSRA next revisits its Assessments & Fee Rule based upon actual experience. Similarly, at that time FSRA will consider whether CB supervisory costs can be allocated on basis which reflects compliance issues (or the lack thereof) at CBs.

The proposed budget was intended to ensure FSRA would have the necessary resources to fulfill its regulatory duties in the sector while striving to be an efficient steward of resources. Should FSRA identify new issues in the sector, FSRA could review the budget to ensure appropriate funds are deployed where required.

FSRA will consider the formalization of its “nexus to Ontario” criteria.

• FP Canada

Stakeholder was supportive of FSRA’s planned framework evaluation and intended to provide detailed comments in response to each of FSRA’s planned review areas through the formal engagement process.

FSRA thanked the stakeholder for its support of the framework evaluation.

• FP Canada
• FAIR Canada

Stakeholders noted that FSRA should enhance its FA minimum standard to the same level currently being proposed in Saskatchewan.

As stated in FSRA’s 2023-2026 Annual Business Plan (ABP), FSRA has committed to conducting a review of the framework, which includes minimum standards for FP and FA title use.

FSRA will consider this feedback as it continues to implement the title protection framework to ensure it is achieving expected outcomes, including regulatory harmonization where practicable.

• FP Canada

The stakeholder was supportive of FSRA’s proposed plan to monitor compliance with title use in the marketplace and encouraged FSRA to work closely with the Financial Planner and Financial Advisor Stakeholder Advisory Committee on this project.

FSRA thanked the stakeholder for its support and will consider this feedback as it develops its approach to assess compliance with title use.

• IFB

The stakeholder noted that FSRA should have a process and policies in place to appropriately handle individuals who may have their FP or FA credential discontinued by a CB.

FSRA thanked the stakeholder for its submission.

FSRA will consider this feedback as it develops an appropriate approach to handle FP and FA credential holders if their CB’s approval is revoked or the CB ceases to operate.