Financial Professionals Title Protection Framework Webinar

Webinar title: Financial Planner / Financial Advisor (FP/FA) Title Protection Framework
Webinar presentation date: June 1, 2021.
Webinar speakers: Mark White, Glen Padassery, Huston Loke, Joel Gorlick, Tim Miflin, Andrea Foy
Webinar duration: 59:46

Time: 0:00:00 --> 00:03:42
Slides: 1-2
Speaker: Glen Padassery

Spoken words, slide 1-2: Hello and good morning everyone and welcome to FSRA's Financial Protection Framework webinar. It's inaugural webinar that we're pleased to be able to have you all attend today. My name is Glen Padassery. I am the Executive Vice President of Policy, as well as the Chief Consumer Officer at FSRA. My preferred pronouns are he, him and I. And I have the pleasure of being your MC today. Before we begin today's session, I'd like to remind everyone of a few rules of engagement. As you know, as an attendee, you have been automatically muted and your video has turned off. We will have a Q&A session once we approach the Q&A segment, you will be able to direct your questions to us via the moderated Q&A icon on the top, right-hand side of your screen. To submit your question, please type it in the box. And if you would like to remain anonymous, you can check off the anonymous box before hitting submit. Once I received your questions, I will be reading them on the line and re-directing to our speakers for a response. Please also note that this webinar will be recorded and the recording along with a transcript, presentation deck, and any unanswered questions from the Q&A period will be available post-event on the FSRA website. Now that we have that out of the way and as most of you already know, FSRA held the first consultation on the Title Protection Framework between August and November in 2020 and we received over 43 written submissions. In addition to the formal consultation, since 2019, we have been working both formally and informally with a variety of stakeholders to help inform the design of the Title Protection Framework. We've met with industry stakeholders, consumer groups, including our Consumer Advisory Panel to discuss in detail, the benefits and impacts of title protection to businesses and associations, title users and consumers. On May 11, FSRA reposted the proposed rules and application guidance for a second consultation, which is intended to close on June 21st. We also proposed new supervision guidance, which outlines FSRA's approach to monitoring and enforcement. To help you understand the updates to the proposed framework today, we will be providing information on our rational and key principles for design of the framework, key themes that we heard during the consultation, and findings from our consumer research survey. The proposed changes to the rule and application Guidance. The proposed supervision guidance in our approach to establishing a fee structure, as well as next steps for implementation of the framework. We hope that you will find today's webinar informative and just before I hand it over, I wanted to just introduce who are the guest speakers with me joined from FSRA today. So, as you will see, on the screen from left to right, Mark White is our CEO and he'll be providing some opening remarks in a moment. Followed by me, and I'm your MC today. Huston Loke is going to be one of the presenters today. He is the Executive Vice President of Market Conduct. Joel Gorlick will be the other co-presenter. He is the Director of Policy of Market Conduct supporting Huston's area and has been with the team, supporting the development of the Title Protection Framework. Joined with Joel and Huston are Tim Miflin who is our Senior Manager of Policy leading the FP/FA Framework. As well as Andrea Foy, our Senior Policy and Technical Leader, who has been instrumental in the design of the framework itself. So, with that, I am pleased to provide the microphone over to Mark White our CEO. Over to you Mark.

Copy, slide 1: Financial Planner / Financial Advisor (FP/FA) Title Protection Framework. Date: June 1, 2021. Speakers: Mark White, Huston Loke, Joel Gorlick, Tim Miflin, Andrea Foy.

Visual, slide 1: Presentation cover slide. White headline text left-aligned [left position] on FSRA’s Midnight Blue background colour. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. White sub-headline text left-aligned [positioned to the left]. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 2: Speakers. Mark E. White, Chief Executive Officer. Glen Padassery, Executive Vice-President, Policy & Chief Consumer Office. Huston Loke, Executive Vice-President, Market Conduct. Joel Gorlick, Director, Policy-Market Conduct. Tim Miflin, Senior Manager, Policy. Andrea Foy, Senior Policy & Technical Lead. 

Visual, slide 2: Presentation slide. Photos capturing all speakers in a rectangular photo shape, Mark E. White, Glen Padassery, Huston Loke, Joel Gorlick, Tim Miflin, Andrea Foy [in sequence, left to right] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Time: 00:03:42 --> 00:06:23
Slides: 2
Speaker: Mark White

Spoken words, slide 2: Thank you. Thank you, Glenn and a good morning everyone. Thank you for joining us today for FSRA's technical briefing on our proposed Financial Professionals Title Protection Framework. An important part of FSRA's mandate is consumer protection and we see our proposed framework as an opportunity to protect the public through working with stakeholders to implement minimum standards in Ontario to govern the use of the financial planner and financial advisor titles. Practice stakeholder engagement is hopefully a FSRA Hallmark, and your input is essential to successfully finalizing and implementing this. Today, as Glen mentioned, we're excited to walk you through the updates we made today to respond to the feedback we have received today and to describe some other key building blocks of the proposed framework. We welcome your questions on the framework. Today's an opportunity to hear from you about this important consumer protection initiative. FSRA's proposed Title Protection Framework, will give definition to the Financial Planner and Financial Advisor titles for their use in Ontario, and will for their use. The framework aims to ensure that individuals using these titles are properly qualified to serve their clients and well supervised if issues arise. This will promote professionalism and proficiency and will help remove consumer confusion and will enhance consumer confidence. Importantly, the proposed Title Protection Framework will not result in a new regulatory regime for individual title users. Instead, FSRA will leverage existing regimes, or licensing and designating financial professionals. Using these existing regimes will minimize burden and cost and will avoid the duplication that could occur, and this should help ensure efficient and effective regulation. Once the framework's in place, financial planning and advising qualifications and activities in Ontario will continue to be overseen by the licensing in designation granting entities that FSRA has recognized as credential bodies. FSRA will protect consumers by overseeing approved credential bodies to ensure ongoing consistency, with minimum standards. FSRA will also protect the public by ending title use by those who were not approved by a credential body. With that I'll hand it over to Huston. I look forward to hearing your comments and feedback during the Q&A session and of course, to receiving your submissions for public consultation. Thanks very much. Huston, over to you.

Time: 00:06:23 --> 00:14:48
Slides: 3-8
Speaker: Huston Loke

Spoken words, slides 3-8: Thanks very much, Mark. So, all of you in the audience, please accept our welcome in terms of continuing this discussion on the Financial Planner / Financial Advisor title protection framework. The agenda that is on screen sets out what we're trying to do today. We're going to talk about the rational and key principles. We're going to talk about key themes from the consultation. Then we will proceed to go through what has changed and what is new. There will then be a time for a Q&A and we really wish to hear from you and so please get your questions ready as we go through this discussion and then contact details and additional items in the appendix that will give more background on some of the material that will be discussing over the next little while. So, let's go right into things and I'll just talk to the rationale and key principles. As of right now, there are no rules in terms of the use of titles. In particular, when we look at the landscape and consider the needs of retail investors, it is currently the situation that an individual with minimum proficiency can hold himself out to be a Financial Advisor or a Financial Planner without any level of assurance or oversight. So, the Title Protection Legislation that's been passed in Ontario represents the fulfillment of a promise that certain titles, Financial Advisor and Financial Planner are only to be used by individuals with a certain level of proficiency and accountability. So, let's go through these key principles. The first one. Mark mentioned, increasing consumer confidence. We wish to establish minimum standards so that when an investor meets with their advisor or gets introduced to their planner, they can be confident, knowing that there was a certain level of proficiency and accountability. Only qualified individuals will be permitted to use those titles. I'll just note here that the legislation speaks to the concept of being applicable to an individual. So, this doesn't apply in terms of businesses, that, for example, act as Financial Advisors, for a large, complex, corporate transaction. That's not the scope of legislation. That's not the intent. What we're doing is requiring individuals using the Financial Planner or Financial Advisor title to meet conduct requirements and proficient, and professional standards. I'm over in the right-hand side of the page. At the same time, as we increase consumer confidence through title regulation, we want to support regulatory effectiveness and efficiency. So, we want to work with existing licensing and professional designation bodies, to become approved credentialing bodies. We want to leverage what they have to offer and the infrastructure that they already have in place. This will grant individuals with existing licences or designations the right to use these titles. Conduct, in terms of their business activities, will be overseen by the approved credentialing bodies, and FSRA will oversee the credentialing body, as the grantor of the title. And this, will weave in discussions with some of our partners across the country to provide a national model for adoption in other Canadian jurisdictions. So, those discussions are underway. In terms of a quick overview of the Title Protection Framework, it's important to note the separation of duties. What is FSRA doing? And what are credentialing bodies doing? On the left-hand side of the slide, we expect to work with credentialing bodies as they apply. There will be transition issues. We're going to implement consumer protection standards as the framework evolves. And we will have a surveillance and enforce the function, including the ability to revoke credentialing body approval, and issue compliance orders. Also, under consideration, is the development of a consolidated public registry, that will make it much easier for a retail investor to determine who is there working for and what gives that individual the right to use a particular title. We think that's an important piece because it really fills a void that currently exists. Again, currently as things sit, there is no regulation on an independent, and no restriction on an individual to use the titles Financial Advisor and Financial Planner, and there is no accountability. So, let's switch over to the right-hand side. Credentialing bodies will be granting credentials. They will be required to maintain continuing education standards. They will be monitoring conduct and that's an important piece. Why? Because strong conduct standards are important. But we do not want to duplicate the efforts of credentialing body. So, we will oversee the credentialing body, but the credentialing body would overview and oversee the conduct of its members. And of course, the consequence of that, if it's, if there is found to be the case of misconduct, they will be able to act disciplinary measures. Let's go on to talk about what the themes were in our consultation so far. So, these seven boxes set out what we've heard and just as a quick reminder, after we go through this then we're going to switch things over, and then Joel will talk about what's changed. So, looking at these seven boxes, here are the concerns that we heard. And I want to just very quickly go over some of the thoughts that we have. First of all, one concern was that the framework could introduce additional burden and duplicative oversight. And what I’d say here, is that the primary objective was really to create that minimum standard for title usage. We want to leverage existing frame works for licensing and designation of financial professionals. And we've been working with entities that do this and bodies that do this in the hopes that we that we can leverage their efforts and that they would consider working with us as credential bodies. This will allow individuals to continue to conduct business as seamlessly as possible using theses titles without additional burden or disruption. Next up, we did hear that there were some concerns in terms of exemptions. Currently the FSRA rule does not contemplate exemptions and when we believe that if there are exemptions, that could dilute the purpose of the rule, which to provide confidence and provide a minimum level of proficiency and conduct oversight. We also heard that the FSRA powers to enforce the framework may not be sufficient. So, this is the middle box here. So, the parameters are set out in the title protection rule. Our enforcement tools will include the ability to revoke a credentialing body or issue a compliance order. The credentialing body will retain the contact oversight of its own members. What else did we hear...We heard that FSRA should consider a harmonized approach with other jurisdictions and we wholeheartedly agree with that and we have had discussions with some of those jurisdictions. And along the bottom, we heard that the transition periods might be too long that we should develop and implement a public registry and we had questions about fees. So, here's what we have to say about that. As part of our public consultation, we proposed changes to the transition periods, but we're also considering implementing a public registry of FA/FP credential holders to be made available at the FSRA website, and we have issued a publication that speaks to the FSRA fee structure and that was released on May 11th. So just a few weeks ago. So, that brings us to the conclusion terms of the key themes. I'd like to now pass the time over to Joel, who will take us through the next part of the presentation. Joel.

Copy, slide 3: Agenda. Rationale and Key Principles. 2020 Public Consultation – Key Themes. What has changed? What is new? Next Steps. Questions and Answers. Contact details for more information. Appendix – Consumer Research. Appendix – 2020 Public Consultation – Key Themes.

Visual, slide 3: Presentation slide. FSRA Midnight Blue headline text and grey text left-aligned [left position] with Deep Orange numbered list. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [right position] on FSRA’s Deep Orange background colour.

Copy, slide 4: Rationale and Key Principles.

Visual, slide 4: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA coloured logo [positioned top-right corner] on a white background. Ontario Coat of Arms [positioned bottom-right corner] on a FSRA Midnight Blue background.

Copy, slide 5: Rationale and Key Principles. The goal of the framework is to ensure that individuals using the Financial Planner (FP) / Financial Advisor (FA) titles are appropriately qualified, promoting confidence and professionalism in the sector. Key Principles. Increase Consumer Confidence. Establish minimum standards for FP and FA titles. Ensure only qualified individuals will be permitted to use the FP/FA titles in Ontario. Require individuals using FP or FA titles to meet conduct requirements and professional standards. Minimum standards will reflect acceptable practices common to more established Credentialing Bodies (CBs), with other CBs given time to improve. Support Regulatory Effectiveness and Efficiency. Allow existing licensing and professional designation bodies to become approved CBs. Granting individuals with existing licences or designations the right to use the FP or FA titles. Conduct will continue to be overseen by the approved CBs. Provides a national model for adoption in other Canadian jurisdictions. 

Visual, slide 5: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Black border box-frame with black text center-aligned [positioned to the center, under headline]. Two-column table listing Increase Consumer Confidence and Support Regulatory Effectiveness and Efficiency in left-aligned bullet points on grey table cell background [center-position, under box frame].

Copy, slide 6: Overview of the Title Protection Framework. FSRA oversight & powers. Approval of applications for FP/FA credentials and CBs. Transitional matters. Implement consumer protection standards as the framework evolves. Enforcement powers, including ability to revoke CB approval and issue compliance orders. Develop a consolidated public registry. FSRA. Compliance Orders. Title users without an approved credential. Approve / Supervise. Approved Credentialing Bodies. Credential / Monitor / Discipline. Financial Planners / Advisors. Credentialing bodies (CBs) oversight & powers. Direct oversight of FP/FA title users, including: Granting credentials, and thereby title use. Requirements for maintaining credentials (e.g., continuing education). Monitoring of conduct. Disciplinary action for breaches of its code of ethics/conduct.

Visual, slide 6: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Center-aligned white sub-headline text on a rectangular-shaped Deep Orange background for “FSRA oversight & powers” and left-aligned bulleted list underneath [left-position]. Flow chart [center position] with FSRA in a teal box [first level], two orange arrows pointing down to purple text-framed boxes, “Title users without an approved credential” and “Approved Credentialing Bodies” [second level]. Orange arrow pointing down from box “Approved Credentialing Bodies” to yellow text-framed box “Financial Planners / Advisors” [third level]. Center-aligned white sub-headline text on a rectangular-shaped Deep Orange background for “Credentialing bodies (CBs) oversight & powers” and left-aligned bulleted list underneath [right-position].

Copy, slide 7: 2020 Public Consultation Key Themes.

Visual, slide 7: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 8: 2020 Public Consultation – Key Themes. Overall, stakeholders supported the establishment of new minimum standards for FP/FA title users. The framework could introduce additional burden and duplicative oversight. Considerations with respect to making exemptions for existing licensing bodies. FSRA’s powers to enforce the framework are not sufficient. FSRA should consider a harmonized approach with other jurisdictions. The proposed transition periods are too long. FSRA should develop and implement a public registry. Questions regarding the fee structure for the framework. 

Visual, slide 8: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Black border box-frame with black text center-aligned [positioned to the center, under headline]. 7 text boxes underneath in colours Deep Orange, FSRA Teal and Mustard Yellow [center position] separated into 3 rows. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Time: 00:14:48 --> 00:24:59
Slides: 9-17
Speaker: Joel Gorlick

Spoken words, slides 9-17: Great, thank you so much Huston. And now that Mark and Huston have given you some of the background and how we got to this stage, I will give you a quick summary of what in the materials we currently have out for consultation and first as Huston mentioned, we can talk about what's changed from the materials that we released for consultation last year. So, Huston just told you about some of the common things we heard in the feedback we receive last year and as he mentioned we are proposing two amendments in response to some of that feedback. Maybe we can just move to the next slide. One of those things as Huston said is we are shortening the transition periods that were previously proposed. Previously, it was a five-year transition period for financial planners. It was 3 years for financial advisors. We are proposing to now to shorten those to four years and two years respectively. We basically heard almost universally from stakeholders that the proposed transition periods were too long. We're shortening the period of time that individuals can continue to use the title without an approved credential. But these two-year and four-year transition periods will still provide sufficient time for individuals to obtain a credential if they still need to. And then the other changes Huston mentioned was as at the bottom of the slide, we added a requirement for credentialing bodies to provide FSRA with the data that we will need to maintain a public registry of financial planner and financial advisor credential holders. This will help ensure that consumers have a way to check that their financial services provider holds an approved credential that actually permits them to use the financial planner / financial advisor title. So on to the next slide...To talk about a little bit about the application guidance. We put this out as part of the package last year. Based on feedback we received, this is the guidance that sets out our approach to administering applications from credentialing bodies. Based on some of the feedback we receive last year, we are proposing some changes. For your reference, part of the package we've posted for consultation actually includes a short two-page summary of all the changes we made to this guidance because we made a lot of them, but I'll quickly highlight just a few for you that are on this, that are listed on the slide. One is we added a proposed minimum standard for credentialing bodies education, and curriculum content. That's intended to provide credentialing bodies with some additional guidance on what FSRA will be looking for in order to obtain approval of the credential. We were told that a little bit of clarity was needed. We also admitted the technical knowledge standard for the financial advisor title specifically. So, that would include at a minimum knowledge of investment products. We lengthened the period of time that FSRA has to review an application. It was originally 30 days and we've now extended that 60 days. And, we've also made changes to the processes and procedures that credentialing bodies will be required to demonstrate. So, that includes any to have a process to assess the suitability of their credential holders, a process to share information with regulators and the other credentialing bodies. For example, in the event that enforcement action is taken against a credential holder. And, finally processes for identifying managing and addressing conflicts of interest. So, that's a quick summary of what's changed from what we released last year. And now if we move down to the next slide, I can give you a quick summary of what's new in the package that we cannot release last year. So, one thing that's new is a piece of a guidance that we're calling a Supervision Guidance. This sets up FSRA's approach to supervision under the title protection framework. So, this new proposed supervision guidance provides an overview of a few different things. As listed here, one is how FSRA intends to monitor and supervise credentialing bodies as well as our complaint handling protocol. How we would take action against individuals who use the FD Financial Planner / Financial Advisor titles without having an approved credential. That is something that is provided for you in the legislation. Our approach to assessing titles that could reasonably be confused with the Financial Planner or Financial Advisor titles. Also, provided in the legislation. And finally, how we will enforce breaches of the financial professional’s title protection act. So, on the next slide, you'll see the Supervision Guidance. If you look at it, it actually includes some illustrative examples of titles that FSRA considers could reasonably be confused with the Financial Planner and Financial Advisor titles. As well as titles that in our view are not likely to be confused with the Financial Planner and Financial Advisor titles. It's by no means an exhaustive list, but I would certainly encourage you to have a look at it. I know many of you will have comments on some of the examples that we have chosen. And we certainly welcome any thoughts or comments you may have on any of them. Our overall approach here will be to review any concerns or complaints that are brought forward about the use of titles that could reasonably be confused with. Either the Financial Planner or Financial Advisor title on a case-by-case basis. So, what you see here at the bottom or a few examples that we've taken, we've taken a few examples from the larger list that we've included in the Supervision Guidance. Which again, I would encourage you to have a look at. Very quickly, I'll go over the examples that we've used here. So, really some of the most obvious examples, any variation in spelling, abbreviation, or the language used for a Financial Planner / Financial Advisor titles. So, if somebody uses the FP/FA abbreviations, call themselves a Financial Advisor with an 'e' instead of an 'o'. Those we consider it would certainly be reasonably confused with the Financial Planner / Advisor titles. The next one down on the left-hand side, if you use a title that has any combination of the word Financial Planner / Financial Advisor, but with other words included. For instance, we've used examples like Financial Wealth Planner, Financial Planning Advisor. A combination of words like that we consider would be reasonably confused with the FP/FA tiles. And finally, another example would be if you used in combination with another term like Senior Financial Advisor, Financial Advising Coach. That type of thing. On the right-hand side, and I know there will be certainly many thoughts about a lot of these that are on the larger list. Examples of titles that we think would likely not be reasonably confused with Financial Planner / Advisor. So, for instance, the word, just adviser on its own, with an "e" or with an "o". We don't necessarily consider would be reasonably confused with the Financial Advisor necessarily. All this, again, will be considered case-by-case as they're brought to us. Wealth Advisor, Wealth Planner, those are other examples, as well as Senior Advisor or Advising Coach. Those are examples we've chosen. We sort of cherry-picked from that list that we have out there as part of the Supervision Guidance. So, I'm sure that many will have that will have comments and thoughts on that. We definitely would love to hear your feedback. So, moving on to the next slide. The last new element that I want to highlight for you in this package is the proposed fee structure for the framework, and the types of fees that would be charged to credentialing bodies under the framework. So, overall, our proposed fee structure for this type of title protection framework is designed to support FSRA's operations as an independent self-funded regulator. As we're noting on this slide, in our publicly released business planning materials that are out there. FSRA has estimated cost for this framework. A little further down the slide, you'll see 3.1 million dollars to design and implement the framework up to March 31st, 2022. We're calling those the start-up costs. As well as approximately 1.1 million dollars in annual regulatory costs to oversee the sector once we launch. So, as we're noting here under the fees, we are proposing to charge credentialing bodies an application fee of $10,000. That's a flat fee, for approval of a credentialing body. Plus, a fee of $5,000 for each application for approval of a Financial Planner or a Financial Advisor credential. There may be examples where one credentialing body may want to apply but may want to apply for more than one credential. So, that covers that scenario there. In addition, we are also proposing to charge an annual assessment, and that consists of a few different pieces as you'll see here. One is a fixed annual fee in that amount is $25,000, to cover a portion of FSRA's operational costs to oversee the sector. As well as a variable annual assessment and that will be based on credentialing bodies proportion of credential holders. So, how many credential holders they have. And for the first five years of the framework, an additional annual fee, that will enable recovery for a start-up cost. So, start-up costs are amortized. Will be amortized for over 5 years and again, those will be allocated based on each credentialing body proportion of credential holders. Now overall, as noted here we've estimated that the proposed structure would result in an average annual cost of approximately $22 per credential holder and that average cost should actually decrease, once the start-up costs are fully recovered. It'd go down to about $14 per credential holder based on what we're estimating right now. All of this is laid out in the appendix that's included in the consultation package. So, you'll see in the consultation materials as well that we've included some illustrative examples of what these fees could look like for different sized credentialing bodies based on this proposed model. So, I'd encourage you to have a look at that. And I should also note that we do plan to launch a public consultation on a separate FSRA rule regarding fees under this framework this summer, hopefully. After the conclusion of the current consultation that's ongoing right now. So, that was a lot of information, I realize. I'll talk very quickly about next steps before I head things back to Glen for the Q&A. We are exactly halfway through our current consultation period. The consultation period will end on June 21st. We're going to consider all the feedback we receive, including what we hear from you today to determine if additional changes to the proposed rule and the guidance that I just talked about will be needed. If you haven't already checked it out, the link to the consultation is included right here on the slides. I'm sure, you folks have seen this, but definitely encourage you to go and look at that. As I mention after this consultation is complete, we do plan to launch a 90-day consultation this summer on a proposed rule regarding fees under the framework. After that's been completed, the plan will be to finalize the rules, submit them to the Ministry of Finance for approval, which is part of our process. And then, as noted here on the slide, we will, we will also at work with credentialing bodies after that time to make sure that the application process run smoothly and that our supervision framework is up and running when we implement the framework. Subject to all the approvals I just mentioned, we're hoping to be able to launch the framework in the first half of 2022. So, I know a lot of information. I appreciate your patience. Now will get to the most important part of this event, which is your questions. I'll head it back to Glen to take us into the Q&A.

Copy, slide 9: What has Changed?

Visual, slide 9: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 10: Financial Professionals Title Protection Rule (FPTP Rule). Transition Timelines. FSRA has amended the FPTP Rule to. Shorten the transition period for Financial Planners from five years to four years. Shorten the transition period for Financial Advisors from three years to two years. The revised transition periods will reduce the time in which individuals who do not hold an approved credential can continue using the FP/FA title. Stakeholder feedback from the 2020 public consultation suggested the initially proposed transition timelines were too long. Public Registry. FSRA has amended subsection 4(4) of the FPTP Rule to require approved credentialing bodies to provide FSRA with information necessary to maintain a consolidated public registry. During the public consultation, most stakeholders expressed support for a single source of information, which would provide consumers with confirmation of financial services representatives who hold an approved credential that permits them to use the FP/FA titles.

Visual, slide 10: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list [left-position] for Transition Timelines and Public Registry. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 11: Application Guidance. The Application Guidance sets out FSRA’s approach to administering applications under the FPTPA. Several clarifications and enhancements were made to the Application Guidance as a result of feedback received during the 2020 public consultation. Adding the minimum education requirements and how FSRA will assess the curriculum for FP/FA credentials. Amending the technical knowledge standard for FA title use to include, at a minimum, knowledge of investment products. Lengthening the application review period to 60 days. Enhancements to the processes and procedures that CBs must demonstrate, including. Ensuring the suitability of credential holders, both at the time of obtaining the credential and if enforcement action has been taken by another approved CB/regulatory body. Information sharing with other approved CBs and regulators. Conflicts of interest.

Visual, slide 11: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list and numbered list [left-position]. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 12: What is New?

Visual, slide 12: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 13: Supervision Guidance. The Supervision Guidance sets out FSRA’s approach to supervision under the title protection framework. This includes providing guidance on how FSRA will. Monitor and supervise approved CBs. Handle complaints. Take action against individuals who use the FP/FA titles without an approved credential. Assess “titles that could reasonably be confused with” FP/FA; and Enforce breaches of the FPTPA.

Visual, slide 13: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list [left-position]. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 14: Titles that “could reasonably be confused with” FP/FA. The title restrictions under sections 2 and 3 of the FPTPA extend to the use of the FP and FA titles in another language, an abbreviation, or a title that “could reasonably be confused with” the FP or FA title. Appendix 1 in the new Supervision Guidance outlines illustrative examples of titles that FSRA considers could reasonably be confused with FP/FA, and titles that likely would not be confused with FP/FA. FSRA will review any concerns or complaints brought forward about the use of titles that could reasonably be confused with the FP or FA titles on a case-by-case basis. Examples of titles that could reasonably be confused with FP/FA. Any variation in spelling, abbreviation or language of the FP and FA titles (e.g., Financial Adviser, FP, FA). A title using Financial Planner/Planning in combination with another term (e.g., Financial Wealth Planner, Financial Planning Advisor). A title using Financial Advisor/Advising in combination with another term (e.g., Senior Financial Advisor, Financial Advising Coach). Examples of titles that likely would not reasonably be confused with FP/FA. Adviser. Wealth Advisor/Wealth Planner. Senior Advisor/Advising Coach.

Visual, slide 14: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list [left-position]. Two-column table [center-position] listing examples on a grey background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 15: Approach for Establishing the FP/FA Fee Structure. To enable implementation of the title protection framework, FSRA must establish a fee structure that supports its mandate to operate as an independent, self-funded regulator. FSRA is proposing the following fee structure for the title protection framework. Application Fees. $10,000 for an application for approval of a CB. $5,000 for each application for approval of an FP/FA credential. Annual Assessment. FSRA anticipates that it will cost approximately $1.1 million annually to oversee the FP/FA sector. FSRA will also need to recover approximately $3.1 million in costs incurred to design and implement the title protection framework up to March 31, 2022 (“start-up costs”). FSRA proposes to recover these costs through an annual assessment that would include. A fixed annual CB fee. A variable annual CB assessment based on a CB’s number of credential holders; and An amount to enable FSRA to recover its start-up costs (temporary assessment for 5 years). The proposed fee structure would result in a combined average annual cost of $22 per credential holder (based on the relevant assumptions).

Visual, slide 15: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list [left-position]. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 16: Next Steps. 

Visual, slide 16: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Copy, slide 17: Next Steps. Second Public Consultation on the FPTP Rule and guidance. Continue to engage with stakeholders during the 40-day consultation period. Consider feedback and determine whether additional amendments to the proposed Rule and guidance are required. The consultation period is open until June 21, 2021. https://www.fsrao.ca/engagement-and-consultations/financial-professionals-title-protection-rule-and-guidance-second-consultation. FP/FA Fee Rule. Summer 2021 – Post proposed FP/FA Fee Rule for public consultation. Engage with stakeholders during the 90-day public consultation period. Consider feedback and determine whether amendments to the proposed FP/FA Fee Rule are required. Finalize Rules and submit to Minister of Finance for approval (Fall 2021 – TBD). Engagement with credentialing bodies. FSRA will engage with prospective credentialing bodies to help inform the design of the application process and set benchmarks and expectations for credentialing bodies approval and supervision.

Visual, slide 17: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Left-aligned grey text bulleted list [left-position]. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Time: 00:24:59 --> 00:26:25
Slides: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Joel. I want to make sure…can you hear my okay? Thank you very much, Joel. We're going to be moving into the Q&A portion of the event. So, in fact we've actually been receiving a number of questions and answers about the presentation. So, let me just start off by reminding folks that a question that came through multiple times, we will be actually posting this presentation up on the FSRA website for people to be able to download on their own and provide their own questions as a result of that, as well as a reference document. There are several questions already posted. I'm going to do them in order as I see them. In some cases, I may paraphrase if there were multiple questions around the same topic, but rest assured, we plan to post a response is up on the FSRA website as well. And, any questions that did not get answered will also be posted on the FSRA website with a response. So, with the first question, it's coming in as, "will advisors already actively certified as CFPs or PFPs (Certified Financial Planners) or (Personal Financial Planners) be grand-fathered under the rules? Or will it be a two-step process for the firm and the individual must be registered?" So over to either Huston or Joel to respond.

Copy, slide 18: Your Questions Answered.

Visual, slide 18: Presentation slide. Large and bold FSRA Teal headline text, center-aligned [center position] on a white background. FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.

Time: 00:26:25 --> 00:27:47
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: Hi, Huston. I can jump in on this one if you want. I would say, first of all, there isn't any grandfathering. I hope everyone can hear me. There isn't any grandfathering under the framework. There are no exemptions either for existing credentials. I think as Mark said off the top, we're looking to leverage existing credentials, that are out there in the marketplace right now. Certainly, the CFP and the PFP are examples of Financial Planner credentials that exists out there right now and are given out by existing bodies. So, definitely, we have been in conversations with those bodies about, you know, what that could look like if they were to come into the framework as credentialing bodies and apply for that. I guess what I will say is, there is, as we mentioned earlier a transition period built in, where in the case of a financial planner, because we're talking about CFP and PFP, there will be a four-year transition period after the framework is implemented. So, if somebody does not have a credential that is considered to be an approved financial planner credential, they will have four years in which to go and arrange to get one. So, on day one, when the framer comes in, just not having that credential right away, won't mean if you've been calling yourself a Financial Planner for however many years, 10 years lets say, you'll still be able to do that. But only on a time-limited basis for the first few years that the framework is in place. Hopefully that helps.

Time: 00:27:47 --> 00:28:13
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: So, thanks, Joel. I hope the microphone switched back to me. Thanks, Joel. So, I'm moving on to the second question, and, "what is FSRA's rationale for determining the LLQP is not sufficient for the FA title use? Huston, you want to take that?

Time: 00:28:13 --> 00:29:05
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: Sure, I'll take that one. Glen, so the LLQP is very heavy on the product side and that there are a lot of benefits from the LLQP and it of course provides the proficiency standards for life agents. We don't believe that it matches up sufficiently with the standard that we're trying to achieve. In terms of the full package that the financial advisor is intended to deliver. We may consider whether there are alternatives by which a life licensed individual could bridge the gap to meet the standard for financial advisor title usage. There may be credentialing bodies that can step in into the discussion to bridge that and we will continue to engage with the industry on the LLQP content as we finalize our position.

Time: 00:29:05 --> 00:29:30
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Huston. And, I'm moving to the next question and it is around, "will FSRA retain ultimate jurisdiction over the conduct of individuals FP/FA's? For example, what happens if the credentialing body does not take appropriate action to protect consumers. Could FSRA intervene directly?" I'll throw this one to you, Huston. 

Time: 00:29:30 --> 00:30:50
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: Yes, so this one speaks to the heart of what we're trying to accomplish here to the extent that there are concerns in terms of conduct that are...We want those to be handled by the credentialing bodies. That's the bases, that their application will be submitted to us. They would say we have conduct standards, we have proficiency standards. Here is our enforcement, your package. This is what we value, we deliver, in terms of investor protection, on that basis of FSRA. We are applying to be a credentialing body. FSRA would look at that, and we would be entitled to do reviews. And so, what we can do, if we determine that in fact, promise is not being kept. And, in fact they are not appropriately, overseeing their members, then what FSRA could do would be placed terms in conditions in terms of their credentialing body status, or if the conduct warrant such a move. We could revoke the credentialing body status for that credentialing body. And if that's the case, then the individuals that are part of that framework would not be entitled to use the title.

Time: 00:30:50 --> 00:31:27
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Huston. I'm just moving to the next question. It was provided by Melissa. "Good morning, can you please speak to more about why the SRO's, so IIROC? And MFDA might be considered to be CBs credentialing bodies, while the CSA would not. As far as I understand, IIROC and MFDA do not provide courses credentials for individuals. Is the idea that SRO's oversight of firms themselves is sufficient? If that's the case, why is the CSA not also included. With thanks for any additional context, you can provide. So, Joel, do you want to take that one?

Time: 00:31:27 --> 00:32:14
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: Sure, I think the basic difference is in the SRO's, MFDA and IIROC, already partnered with an education provider right now, for the purpose of establishing education standards for registrants. So, really, in our view, they’re well placed to act as a credentialing body. I mean again, there are no, you know, there are no credentialing bodies yet. The application process is being set up, but I would say that's the main difference. In addition to having direct oversight of the registrant's, the SRO’s are already basically are in the business of providing the education standards, which is a key component of what bodies will do. So, that's essentially the reason why versus first of the CSA, which has oversight, but does not have that function as I understand it. I don't know whether Huston, he's got any to add to that?

Time: 00:32:14 --> 00:32:49
Slide: 18
Speaker: Mark White

Spoken words, slide 18: I just mention that, it also reflects one of the Hallmarks of the FA credentialing body can subcontract or things like education. And so, it doesn't mean that you have to have it all in-house. When we review credentialing bodies application, we're going to make sure that we think you can meet the minimum standards. And, if it doesn't then that at inception, within that short period of time. I could do that indirectly through also having an education partner. So, that doesn't mean that the education part also needs to be a credentialing body.

Time: 00:32:49 --> 00:33:33
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Mark for the follow-up. I'm actually going to use MC prerogative and combine a few questions. So, the next question is, "why is the scope of title restrictions so narrow? What is the point of the exercise if someone could change to a title that from a consumer perspective is really quite similar? For example, how would it have to, like wealth consultant or advisor, that appears to be outside of the scope materially improve customer confusion. In addition, can you also talk about why titles like President or Vice President that were prominently addressed in the original versions of the FA title project also be excluded?"

Time: 00:33:33 --> 00:35:21
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: So, I can take it, take a crack at this, Glen, if that's okay. I mean, I would say the legislation that has light at the financial professionals, total protection act and speak to the two specific titles, Financial Planner / Financial Advisor, where that previous initiatives has proposed to go further than that, and actually include a wide variety of other titles that are in use in the marketplace. But, you know, has mentioned the Financial Professional Title Protection Act has a provision that says it's those two titles, Financial Planner / Financial Advisor and those that are similar to or could be reasonably confused with those two titles. And, we understand that can be interpreted potentially in different ways. And, that's one of the reasons we've put those titles for discussion in the guidance, as I mentioned earlier. I think, you know, what I would say is, we're certainly open to the idea that there are ways that we can have a good look at different titles in different ways. I definitely would say on the Financial Advisor / Financial Planner side, both, there are a number of different titles like you said. President, Vice President that are in use in different corporations that are not considered to be in scope for this exercise. Think the idea is to give the Financial Planner / Financial Advisor titles specifically, some cachet in the marketplace so that there's value to people wanting to have those titles. Ultimately, I think, hopefully once this framework has been up and running for some time, there will be a reason that people will want as opposed to people saying, oh I'll change my title, so I can avoid this regime. It's more, I want to have that title because I want consumers and investors who come to me for my services to know that I have an approved credentialing. That actually means something in the marketplace as opposed to right now, when Huston said earlier, the two titles, literally don't mean anything because anybody can use them right now. Hopefully that helps a bit.

Time: 00:35:21 --> 00:35:47
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Joel. So, I'm moving to next question, "why does the transition period, especially for the FP credential need to be so long? What is the harm in shortening it dramatically, to 2 years? If you want to protect titles, I would think there was no time like the present in getting on with it." Joel, do you want to take this on transition periods?

Time: 00:35:47 --> 00:37:12
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: Sorry, I was looking for the unmute button. So, I think the idea is we heard it during our consultations going back for the last year-and-a-half. It takes some time to get some of these credentials. In particular, the financial professionals on the Financial Planner side, since someone's mentioned here. You know, just to take the CFP as an example, we've been told they can take up to three years really to get that, from start to finish. So really, I believe in a four-year transition period, really, just allows that three years plus a bit of a buffer to be able to get that credential. Other credentials, may take a little bit less time. We've heard that on the Financial Advisor side, many credentials you can get within sort of a more 12 to 18 months time frame. And, that's why that one is a two-year transition period, instead of four. So, that's why we had to go to draw a line somewhere, I would say, and this is again in recognition, the transition period are for people who already are using the title. And, we have set a date for that. You can't just start using it, you know yesterday, and say that you are entitled to go through this transition period. I believe the day we've chosen is January 1st of 2020, so you have to have been using it for at least the last year and a half. By the time we implement, probably two years to be able to have access to that transition period in the first place. Hopefully that helps.

Time: 00:37:12 --> 00:37:36
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Joel. I'm going to move on and again, there's several questions in and around the registry. So, can you speak a little bit to what might be included in the registry? And in particular, "will the proposed registry include disciplinary actions for all Canadian financial services jurisdictions and regulators?" Huston, do you want to take that?

Time: 00:37:36 --> 00:38:18
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: I think that's the entrance of the use of the registry will allow investors, in particular retail investors, to take a look and determine how their advisor meets certain qualifications. So, I think the contents of the registry is still under development and I think the suggestion here is an interesting one that we will take one reflect on. But, I think that the concept of having a registry where someone can check to see how their Financial Adviser or their Financial Planner is credentialed is one that we do want to bring forward and that will be an easy way for investors to check on status of their profession.

Time: 00:38:18 --> 00:39:40
Slide: 18
Speaker: Mark White

Spoken words, slide 18: Huston, thank you. Just quickly chime in. Interesting ideas to do it through the registry, but one of the things that is in our current consultation because we've heard the story of our stakeholders engagement is, it's very important for us because of multiple credentialing bodies that there be good communication between those credentialing bodies and there be consistent information. So, we're also hoping that this can be a platform Québec already has an FP regime, but we're hoping that this could be something that could be adopted as particularly as the potential credentialing bodies are national. So, we're actually hoping that over time, this would evolve to our credential bodies. It will have positive obligations and will develop mechanisms with them through their credential body approvals, so they will share that information. So that if someone is sanction, and hopefully, this is as I say, can be multi-jurisdictional in and beyond Ontario, across Canada. So, we get that information from all credential bodies and hopefully across provincial boundaries as well. So, it may not work to the public registry, but we believe that information sharing very important because it needs to be consistency so that somebody doesn't just, you know, get sanctioned and get their title use removed by one credential body and they move to another potential body without us making conscious decisions as to, why that would be okay. 

Time: 00:39:40 --> 00:40:09
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Mark. Huston, I'm going to give this question to you. It's really around the application process for a credentialing body. And, the question is really around the sixty-day application review clock. So, "can FSRA stop the sixty-day application review clock if the applying credentialing body fails to provide adequate materials are responses to FSRA queries, during the application process?" Maybe, you'll talk a little bit about the application process and then that specific question, that would be helpful. 

Time: 00:40:09 --> 00:41:06
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: Yes, so we have developed an application process. We have a team that will look at these applications. The materials must be complete. Our service standards will rely on credentialing bodies, submitting a full application. So, to the extent that there is included information then the clock will essentially stop. If there are questions related to the specifics of the application. Again, we're happy to take that offline, and there are materials that have been submitted for public comments, that speak that process. The process that the legislation sets out the content of the application, in terms of things like governance and the proficiency standards that will apply the oversight for conduct perspective and in those who are reflected as part of the application.

Time: 00:41:06 --> 00:41:39
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Great, thank you Huston. There are a few questions in here related to business enforcement powers and so I'm going to try and do a combined here, but essentially can you speak to what is FSRA's enforcement against an individual will look like, and can you talk a little bit about the powers that we have? And, in particular, can you speak to whether we have the ability to strip someone of their credential, or their title use and are there any fines for misconduct? Joel. 

Time: 00:41:39 --> 00:42:55
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: So, I can speak to that, for sure. There is very limited ability under the legislation for FSRA to take action against individual title users really. That's limited to, FSRA has the ability to ensure compliance order against an individual who uses the Financial Planner / Financial Advisor title, but who does not have an approved credential. For those that do have approved credentials, as Huston went through earlier, it's really the credentialing bodies that will have responsibility for oversight of those individuals. So, FSRA for instance will not have the ability to take away a Financial Planner / Financial Advisor credentials from an individual. FSRA has oversight of the credentialing bodies and the credentialing bodies, if they see a conduct issue or some reason that they feel that one of their credential holders needs to have action taken against them, that is up to the individual credentialing body yet to take that action. So really, most of our enforcement is with respect to the convention bodies directly. There are some enforcement provisions in the legislation, with respect to what action we are able to take and that's up to and including potentially revoking and credentialing bodies approval. If we find that a credentialing body has not lived up to its obligations under the act. I don't know if you've seen, you have anything to add to that. 

Time: 00:42:55 --> 00:43:23
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: No, that's great, Joel. Thank you. I'm going to go to the next question. The requirement for maintaining credentials for titles. So, this is on the title use themselves with the credentialing body. "Will this be a compliance department responsibility or a function of the credentialing body to oversee, or is there an audit process to this from FSRA's side and what might an audit look like?" I'm going to give this one to Huston.

Time: 00:43:23 --> 00:44:43
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: We anticipate that we would do risk-based reviews of credentialing bodies in terms of maintenance of their requirements for titles. So, in their submissions to us, they would tell us about their continuing education standards and their oversight standards for their members. We expect that we would meet with them again, on a risk using a risk-based approach to determine if those obligations are being met. And, if that's the case, then things would continue. We do expect that engagement with credentialing bodies and their level of supervision in terms of their own members, and the results that they can, they can share with us, will go a long way in terms of doing two things. First of all, it's really ensuring that consumers can be confident when they engage with the services of the Financial Advisor / Financial Planner. In the second thing is leveraging off of their skills. Their compliance programs and the results that they share with us will determine the frequency of the intensity of our interviews. Because if they're doing a good job in terms of that oversight, then there will just be a better arrangement where we will need to engage with them less in terms of ensuring that's been done. 

Time: 00:44:43 --> 00:44:45
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Mark, did you want to add to this? 

Time: 00:44:45 --> 00:46:15
Slide: 18
Speaker: Mark White

Spoken words, slide 18: Yes, these last couple of questions - there is a very important design choice that we take as a given because of the legislation. There's a role here is to make sure that the credentialing bodies are doing a good job with it. That's in the entry-level qualifications or the ongoing supervision of the people who are using the titles. And, we are not, we are of course supervising those who are not approved, or we're monitoring those and change the sanctioning if you're not part of the credentialing body, so you don't have the right to use the title, but leaving that aside, the design choices that to keep the cost down and to have only one level of supervision for the individuals who are title users. Then, we're going to look to the licensing and the designation granting bodies who get approved as credentialing bodies to do that job rather than duplicate that. It's a design choice. I think it's a good one. So, we're glad to receive comments on that, but we do take that as a given and I don't think we'd be able to put this regime in place so quickly and frankly relatively inexpensively as well, as dealing with the multiplicity of existing your good licensing and designation bodies that exist and have people out there who maybe using their FA/FP title. I don't think we could put that in place in anyway, unless we did use that leveraging off of the existing credentialing bodies and not trying to duplicate that.

Time: 00:46:15 --> 00:47:10
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Mark. So, there's a question here and I'm actually going to just paraphrase it based on the way the question was posed. But essentially, "how does FSRA contemplate preventing a qualified title user, either a Financial Planner or a Financial Adviser from offering the services that they're not entitled to offer? So, for example, if a Financial Advisor starts offering Financial Planner services, but they only are qualified or have the permission to use the Financial Advisor title, in conversely Financial Planner to Financial Adviser. How does the client know what they're getting, and how do you know, or how do we intend for people to only offer the services that they're entitled to use?" So, this is really about the type of services as opposed to the title themselves. Huston.

Time: 00:47:10 --> 00:47:50
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: I think that the important part to remember, as part of this oversight, is that the services themselves can continue and they do not change. What we are going to be regulating is the title and the title usage, to ensure that there is some currency and there's some meaning behind that. So, the individuals and the professionals that engage with client and do this work, I think it is just critical to know that work could continue and is not intended to get to be changed. But when people start using the Financial Advisor / Financial Planner title, at that point, they would need to be part of a credentialing body membership.

Time: 00:47:50 --> 00:48:35
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Huston. Just for the audience, and we have way more questions than we are actually going to have time to answer, just based on the time frame. So, I'm doing my best to systematically go through the questions as they came in. But I'm just finding that we may not get to the ones that were recent…but I'm trying to combine where appropriate. So, there's a question coming in, "how many credentialing bodies or/and how many title users under FP/FA does FSRA expect to operate under the new framework?" So, can you give us a sense of how many credentialing applications for or approving and how many title users do we think will be under the new regime? Joel, do you want to answer that one?

Time: 00:48:35 --> 00:49:30
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: Sure, it's a difficult one to say, I guess, because we don't yet know how many credentialing bodies there will be. We don't expect there to be a large number. I would say, you know, certainly, not expecting more than a, not putting too far out into the double-digits. I would say, less than double digits, in terms of credentialing bodies. At least when the framework gets started. In terms of the number of individual Financial Planners and Financial Advisers that are out there in the marketplace. Financial Planner is one that we have some numbers on based on who holds different credentials right now, like the CFP and the PFP, etc. That's information we can get for you. Financial Advisors is a little more difficult because not everybody to use the Financial Advisor title falls under the same domain. You know, some are overseen, by different bodies. So, until we get it up and running, it will be hard to know the overall number. I think Huston was looking to chime in on this as well. Sorry.

Time: 00:48:35 --> 00:50:10
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Perfect, thanks, Joel. I'm going to combine in a few questions here around the multiplicity of credential, credentialing bodies and potential title users. So, "will FAs or FPs that hold qualifying credentials from more than one credentialing body need to make an election of one credentialing body as their primary?" And, in addition (and it's a follow-on).."can a person who is qualified to use both titles use both or will the person need to choose between one of the two?" It's sort of a two-part question. Huston, do you want to answer that one?

Time: 00:50:10 --> 00:50:37
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: Currently, it's not contemplated that you have to sort of choose. You're going to have individual that of course, are...it could be, they could receive designation for multiple bodies. If more than one of those bodies applies to be a credentialing body, then there will be more than one level of membership that allows an individual to use that title. 

Time: 00:50:37 --> 00:50:50
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Maybe you just want to add to the question around, "can I use, if I have ability to use both titles FP and FA, do I need to choose between the two as opposed to within credentialing bodies themselves?"

Time: 00:50:50 --> 00:50:50
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: We always appreciate, of course, people wanting to add to their knowledge base. They will have the option and they will be able to determine which they use. We know that sometimes those a different set of professionals bring different skills the table, but it'll be up them. 

Time: 00:50:50 --> 00:51:41
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Great. Thank you, guys. So, there's a question about fees. So, "many professional bodies only have a limited number of members that could actually do financial planning or want to use the title. Are the fees restricted only to those members that provide the financial planning service or will they be charged to all members?" Let me just add to that to help clarify the question. It's really about the title uses themselves. Are we only going to charge based on the number of people who use the title from a credentialing body or the entire membership base? Joel?

Time: 00:51:41 --> 00:52:28
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: Telling us, one of the details, we've been actively talking to prospective credentialing bodies about. It's a big one on a lot of people's minds. So, if you have a body that regulates twenty thousand individuals, but only 10,000 of those individuals are actively using the financial advisor title, let's say, are you paying until your fees based on those ten thousand title users or are you paying it based on your twenty thousand over all members? I would say where that's the one active conversation. I don't think we've landed on what the final solution is there because I think it is difficult to determine who the active title users are among an organization, unless the organization asks for an attestation from you for all of its members, which is one option. And then, you go buy by title users as opposed to all of the credential holders. I think, Mark, you had something to add to this.

Time: 00:52:28 --> 00:53:32
Slide: 18
Speaker: Mark White

Spoken words, slide 18: Yeah, Joel. I mean, it is difficult for us to try and police that. If in...I can't give you the exact numbers, but they have 20,000 members or licenses, and only ten thousand use it. We would be completely open though to a subcategory so that the 10,000 are identified in a certain way. And, that it would only seek approval to have that specific sub-designation, if you will, as identified as the FA/FP, would mean the others could not use it. So, now we're looking to credentialing bodies to also think about how this will benefit their membership. Our starting assumption is that they will benefit all their designation or license holders equally if they apply to use an FA or FP, or approval to use FA or FP with those. But it's up to them if they'd like to try and somehow subdivide that in a way that is actually identifiable and manageable. So, you know, I look up to them to come up with that solution.

Time: 00:53:32 --> 00:53:52
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Mark. I am conscious of the time. We're going to get through a couple of more if we can. So, "why was at best interest standard left out of the framework or more aptly, why is FSRA not proposing a fiduciary standard for Financial Planner and Financial Advisors?" Huston, do you want to field this one? 

Time: 00:53:52 --> 00:54:31
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: There are certainly lots of opinions in terms of what is the best way to protect investors. We think that particular issue is best left to those that regulate to our conduct. So, there are bodies including the CSA and others that have weighted on that. And, that's a decision that those organizations are making. From our perspective, we think it is of paramount importance, to have those proficiency standards of corporate governance and appropriate enforcement and oversight. And, we'll be focusing on those elements of the top protection framework, to protect our investors.

Time: 00:54:31 --> 00:54:53
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Huston. I'm going to try and combine in a few questions and leave us some time. So, "what will the complaints process look like? And, in particular, how will you identify individuals that are not eligible to use the FA or FP title?" Joel.

Time: 00:54:53 --> 00:55:28
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: I'd like to speak to part of that, certainly. I know that in terms of how we identify those that are misusing the titles or using them without approved credentials, that will be largely complaints-based. People bring to us knowledge of somebody using another Financial Planner, a Financial Advisor title and they don't believe they have an appropriate credentials to do so. So, that is something that they can bring to FSRA. And, FSRA can look into taking action against that individual, in a form of a compliance order. In terms of the actual complaint’s framework and how they're going to be handled within FSRA, I would probably defer to Huston to lay that out of it. 

Time: 00:55:28 --> 00:56:30
Slide: 18
Speaker: Huston Loke

Spoken words, slide 18: So currently, we receive complaints. For example, if someone says...this individual is not a mortgage broker. Why did you...They are holding themselves out and they are providing services? And we receive complaints that say, this individual is not an insurance agent. And we action those by issuing essentially a notice, where appropriate, to say this individual is not licensed. We see something similar taking place in the title usage framework. So, if someone identifies that there is an individual who is not entitled to use the Financial Advisor / Financial Planner title. If we translate ourselves into a regime, where this is meaningful, and it speaks to the level of proficiency and oversight. Then people will recognize that it's got, it's got a meaning and it conveys that additional level of protection. Then, what we will do is issue a notice after, of course, conducting our own review that identifies that this is a problem. And, hopefully before that, they will agree to withdraw and not pull themselves out and use that title. 

Time: 00:56:30 --> 00:56:40
Slide: 18
Speaker: Glen Padassery

Spoken words, slide 18: Thanks, Huston.  Let's see if we can get through one more. I'll throw this one to, Joel. Joel, "why not adopt the Québec model, which provides a more robust consumer protection framework?"

Time: 00:56:40 --> 00:58:00
Slide: 18
Speaker: Joel Gorlick

Spoken words, slide 18: That’s a great question and we’ve certainly talked to our friends in Québec at the Autorité des marchés financiers about this. And I'll see about this as well as others. I think Québec's motto is very different. It was brought in about 20 years ago. Essentially, it has one credentialing body that has the IQPF, that gives out the ability to be able to use the planificateur financier, the Financial Planner credential and it actually prohibits by regulation a whole list of other titles. So, you can't call yourself a list of about a dozen or so different titles. And it's really… it is illegal for you to call yourself anything but that one title. That is not the direction the government opted to go with the legislation we have in place here in Ontario. It was specific to the Financial Advisor and Financial Planner titles. And, it was not that we were not...it was no regulation created saying, you can, you cannot use the following titles. It just said, if you want to use a Financial Planner / Financial Advisor titles, you will have to get an approve credential from an approved credentialing body, and it did not, unlike in Québec, designate one specific credentialing body for that, for that function. So, this really is designed as a multi-credentialing body and again, it's not nearly as prescriptive in terms of with the respect of that the title usage. That's just a choice, a policy choice the government had made.

Time: 00:58:00 --> 00:59:46
Slide: 19
Speaker: Glen Padassery

Spoken words, slide 19: Thanks, Joel. We are at time and I just wanted to flag again, we received more questions than we obviously had time to answer. And so, I'm just reminding everyone that we will address all other submitted questions and be posting them in a Q&A format on the FSRA website. And, I want to thank everyone for joining us today. Any additional questions that you didn't get a chance to ask today through the chat box, please email them to [email protected] and we will address them. So that would have been the address that sent out the registration and I also wanted to flag that we are going to be sending out a survey, post-event survey, and we would appreciate your feedback on this sort of format, the background, the content, any feedback is helpful for us. As we look to improve this type of session for going forward. So, thank you everyone for being here today. Again, there were more questions than we had time to answer, but we do commit to getting back to folks through our website on the Q&A's that were provided today. And, we encourage you through the consultation period to please consider providing FSRA with your submission. If you would like more information on the screen, you see two names Andrea and Kirubel, please email either one of them and they will be pleased to follow up with you. Both directly from answering any questions you may have or we will follow up to try and set up a meeting to talk to you directly as well. So, with that, I appreciate everyone's time. I wish you all a great afternoon and hope you all have a wonderful lunch. Thank you very much. Everyone have a great day.

Copy, slide 19: For more information please contact. Andrea Foy. Senior Policy and Technical Lead. [email protected]. Kirubel Abebe. Senior Policy Analyst. [email protected].

Visual, slide 19: Presentation slide. FSRA Midnight Blue headline text left-aligned [left-position]. Two-column, center-aligned text listing contact details.  FSRA white logo [right position] on FSRA’s Midnight Blue background colour. Ontario Coat of Arms white logo [positioned to the right] on FSRA’s Deep Orange background colour.
 

Stakeholder Question

FSRA Response

Can you confirm the transition period please? Do those run from January 2020 or from the point of roll out, following the consultation?

Following feedback received as part of the first public consultation in 2020, FSRA shortened the proposed transition periods from 5 years to 4 years for Financial Planner (FP) title users, and from 3 years to 2 years for Financial Advisor (FA) title users. FSRA believes that the newly proposed timelines would provide individuals with sufficient time to obtain a new credential if required. The transition period will begin when the Financial Professionals Title Protection Framework (FPTPF) is implemented. At that time, individuals who were already using the FP/FA title prior to January 1, 2020, can continue to do so until the end of the transition period or when they obtain an approved credential for title usage.  Individuals holding a credential that has been approved by FSRA for FP/FA title use can continue using the title.

 

Stakeholder Question	FSRA Response
“Individuals with existing licences/designations to be recognized as meeting minimum standards for title usage, and to enable certain individuals to continue to conduct business using the FP and FA titles without significant disruption.” How does the MFDA/IIROC potential amalgamation impact the process?	FSRA is aware of the recommendation made in Ontario’s Capital Markets Modernization Taskforce Final Report published in January 2021, recommending a transition towards a single self-regulatory organization (SRO) for the securities sector. FSRA will continue to monitor any developments, but currently does not expect material impacts on the title protection framework.
Appendix D states, “In particular, the framework does not introduce new conduct standards for firms and individuals registered with the Investment Industry Regulatory Organization of Canada (IIROC) or the Mutual Fund Dealers Association of Canada (MFDA).” If we are transitioning to a unified platform (IIROC), would a new set of conduct standards have to be adopted?	One of the primary objectives of the Financial Professionals Title Protection Act, 2019 (FPTPA) is to regulate title usage. It is not intended to impose duplicative or overlapping regulatory requirements on individual title users, and therefore will not result in FSRA directly regulating the conduct of credential holders.   The framework does not introduce new conduct standards for firms and individuals registered with the Investment Industry Regulatory Organization of Canada (IIROC) or the Mutual Fund Dealers Association of Canada (MFDA). Existing regulatory bodies, such as IIROC and MFDA, will continue to oversee the conduct of their registrants/licensed individuals.
Have IIROC and the MFDA agreed to act as CBs?  What if they decide not to?	FSRA’s intent is to have MFDA and IIROC approved as credentialing bodies (CBs) under the framework. This would drive regulatory effectiveness and efficiencies for both title users and approved credentialing bodies. It should also mitigate any potential duplication between the SROs and other approved credentialing bodies.
What can you tell us about the status of conversations with the SROs (IIROC and MFDA) - any potential major obstacles or challenges identified? Or is it anticipated that they will become CBs with relative ease?	FSRA is actively engaging with organizations interested in becoming a credentialing body, including discussions with both IIROC and MFDA. Discussions include operational considerations for the implementation of the title protection framework.
Where the SRO (IIROC/MFDA) decides to become a CB, would this mean that the title is approved by the SRO for their members’ usage?	Individual credentialing bodies will determine which existing licences and designations should be submitted to FSRA for approval for FP/FA title usage. All licences or designations submitted to FSRA must meet the approval criteria in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the associated Application Guidance and Supervision Guidance, in order to obtain approval.

 

Stakeholder Question	FSRA Response
Is there a definitive list of what designations are financial planner compared to financial advisor?	FSRA expects that more than one designation will be submitted for approval for FP/FA title use. In order to obtain approval, all existing licences or designations submitted for FP/FA title use must meet the approval criteria in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the associated Application Guidance and Supervision Guidance. FSRA will post a list of approved credentialing bodies and credentials on its website.
Assuming the CFP designation is recognized, will the PFP designation also be recognized as meeting FSRA’s requirements?	The Financial Professionals Title Protection Act, 2019 (FPTPA) requires an entity to apply to FSRA in order to obtain approval as a credentialing body and to offer an FP/FA credential. FSRA will post a list of approved credentialing bodies and credentials on its website.
Based on FSRA’s own research, it appears that the public doesn’t readily understand the difference between FAs and FPs. If so, would it be fair to say that the standards for the FA and FP credentials should be substantially similar vis-à-vis professionalism and client-centricity? In FSRA's view what is the difference between a Financial Planner and a Financial Advisor, and the services they provide?	The Financial Professionals Title Protection Act, 2019 (FPTPA) does not define the FP and FA titles or associated activities. However, FSRA is proposing different sets of minimum educational standards for the two titles. The intent is to establish a benchmark in relation to the technical knowledge, professional skills and competencies that would be expected for FP and FA title users.  FSRA’s proposals include, among other areas, a requirement for FP education programs to demonstrate sufficient content to provide a comprehensive understanding of all technical knowledge areas, including estate planning, tax planning, retirement planning, finance management, insurance risk management, and investment planning (including alternative investments). FSRA’s proposals also include, among other areas, a requirement for FA curriculums to provide an understanding of standard retail investment products, and how those products should be considered with respect to other areas of financial planning/advice. FSRA will develop a consumer education campaign to support the implementation of the framework, which will enhance consumer awareness of use of the FP/FA titles.
Will the LLQP and Mutual Fund licence be sufficient for an FP credential? Has FSRA assessed the MFDA standard for licensing mutual funds representatives and will they qualify for use of the FA title? What will a person with the designations CLU, CH.FC be regarded as?	The Financial Professionals Title Protection Act, 2019 (FPTPA) requires an entity to apply to FSRA in order to obtain approval as a credentialing body and to offer an FP/FA credential. FSRA does not have the authority to pre-determine the licences or designations that could meet the minimum standards for title use.   All existing licences or designations that may be submitted for approval must meet the approval criteria in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the proposed FPTP Application Guidance in order to obtain approval for FA and FP title use.
What is minimum standard for FA?  Life + fund or investment +?	As part of the materials published in the second public consultation, the Application Guidance includes FSRA’s proposed minimum standard for FP and FA credentials. All existing licences or designations that may be submitted for approval must meet the approval criteria in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the proposed FPTP Application Guidance, in order to obtain approval for FA and FP title use.
Am I correct in thinking that a FA minimum standard is a licence only available through IIROC. If so, how does that ensure the advisor is a profession and protecting the consumer?	FSRA expects that more than one designation will apply for approval for FA title use. All existing licences or designations that may be submitted for FA title use must meet the approval criteria in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the associated Application Guidance and Supervision Guidance, in order to obtain approval. FSRA will post a list of approved credentials on its website.  FSRA believes establishing minimum educational standards for FP/FA title use will strengthen consumer protection and promote consumer confidence when dealing with financial professionals.

 

Stakeholder Question

FSRA Response

Can an individual who does not use the FP title but does financial planning continue to do financial planning (e.g., lawyers and CPAs)? Does focusing on title use rather than the activities performed create a loophole for individuals to hold themselves out as, for example, a wealth specialist? Did FSRA ever consider regulating the FA or FP practice rather than or in addition to the title?     If an entity has 'financial' in their business name, are they able to hold themselves out as "[entity name + financial] advisor" even though the representative may not have the FA credentials? If a client asks a professional without a designation for help with "financial planning," how should they respond to the request?

The Financial Professionals Title Protection Act, 2019 (FPTPA) introduces title protection in Ontario relating to the use of the financial planner (FP) and financial advisor (FA) titles. This includes abbreviations, equivalents in another language, and titles that could reasonably be confused with the FP and FA titles. The FPTPA does not directly regulate individuals’ conduct, and it will not prohibit individuals from engaging in financial planning/advising-related activities.  The framework focuses on title usage and would not restrict the use of terms to describe services offered by individuals in Ontario. However, if someone uses a title that could reasonably be confused with the FP and FA titles, the use of such title could be caught by the FPTPA. This would be considered by FSRA on a case-by-case basis.

 

Stakeholder Question	FSRA Response
Will individuals face possible stripping of their credential or fines for misconduct?	Based on the proposed Financial Professionals Title Protection Rule (FPTP Rule), FSRA will require credentialing bodies to have the necessary expertise, resources, policies, procedures and administrative practices to effectively oversee the conduct of their FP/FA credential holders. This includes robust discipline and enforcement processes. While FSRA is not contemplating prescribing the types of sanctions that a credentialing body must have in place, FSRA will review a credentialing bodies’ processes to ensure that they effectively administer and maintain their credentialing program, so that only qualified individuals can obtain/maintain an approved credential.
What will the enforcement actions entail for someone who uses a credential without authorization and can punitive measures actually be realized?	Under the Financial Professionals Title Protection Act, 2019 (FPTPA), FSRA has the authority to issue compliance orders against individuals who use the FP/FA titles without an approved credential.
If a CB's status is revoked, will there be a transition period for the CB's member firm to change title or take action? Or is the use of the title automatically revoked?	The Financial Professionals Title Protection Act, 2019 (FPTPA) provides the government with authority to make regulations governing the use of titles in circumstances where a credentialing body’s approval is revoked.
Why will FSRA not have the ability to take action directly vis-a-vis an individual FP/FA? Seems like a gaping hole in what is being heralded an important consumer protection initiative.	The Financial Professionals Title Protection Act, 2019 (FPTPA) does not provide FSRA with the authority to oversee the conduct of individual credential holders. Discipline and enforcement of title users who hold an approved credential will be carried out by approved credentialing bodies.  In accordance with the proposed Financial Professionals Title Protection Rule (FPTP Rule), FSRA will require credentialing bodies to have the necessary expertise, resources, policies, procedures and administrative practices to effectively oversee the conduct of their FP/FA credential holders. FSRA has the authority to issue compliance orders against individuals who use the FP/FA titles without an approved credential. FSRA also has the authority to revoke the approval of a credentialing body. FSRA is implementing the framework within the parameters of the FPTPA as written and will continue to monitor compliance with the framework on an ongoing basis.

 

Stakeholder Question	FSRA Response
What will the complaints process look like?	FSRA continues to develop its operational processes and procedures, including the process for handling complaints relating to title usage. FSRA will engage with prospective credentialing bodies to help inform the design of the application process, and set benchmarks and expectations for the approval and supervision of credentialing bodies.

 

Stakeholder Question	FSRA Response
Many professional bodies only have limited numbers of members that actually do financial planning. Are the fees restricted only to those members that provide financial planning or will they be charged for all members?	As part of the consultation material published on May 11, FSRA has included a high-level overview of its approach to establishing the FP/FA fee structure, in Appendix B of the Notice of Changes and Request for Further Comment. FSRA is proposing a fair and consistent fee structure, in which a portion of a credentialing body’s fees will be based on the benefit received under the framework. FSRA proposes that the number of credential holders within the credentialing body’s membership is a suitable proxy for establishing such benefit.
Most CBs are national bodies with members who do not operate in Ontario. Will the 'per member' fees be assessed on all members or just those who operate in Ontario?	Prior to posting the proposed Fee Rule for public consultation, FSRA is seeking feedback on how it should define a credential holder, or whether there are other variables that could be used to establish benefit (e.g., title use, residency, conducting business, etc.).
Can you help us understand any mechanisms you may have in place to manage costs and cost escalations?	As a self-funded independent regulator, FSRA must fully recover its costs for regulating its sectors and delivering on its priorities. FSRA projects its financial activities for each fiscal year as part of its Statement of Priorities and Budget document. Each Fall, FSRA consults on its proposed priorities and budget with members of FSRA’s Stakeholder Advisory Committees. FSRA also posts the document for public consultation. Following consultation, the priorities and budget are finalized in FSRA’s Annual Business Plan and submitted to the Minister of Finance for approval.
How has FSRA calculated the cost of $22 per credentialed individual? The costs seem a lot steeper based on the numbers identified in your consultation document.	The formal public consultation on the proposed fee structure, which is expected to take place over the summer, will provide additional context on estimated fees.
Will individuals with multiple credentials be asked to pay fees to multiple CBs (e.g., CPA and IIROC)?	FSRA has designed the proposed FP/FA fee structure to require credentialing bodies to pay fees directly to FSRA. The proposed structure allows credentialing bodies to exercise discretion in relation to how they recoup costs to fund participation in the framework. Depending on the approach taken by credentialing bodies approved under the framework, individuals that hold approved credentials with more than one credentialing body could potentially pay more than one fee.  Prior to posting the proposed Fee Rule for public consultation, FSRA is seeking feedback on its proposals. Please refer to the public consultation, and Appendix B of the Notice of Changes and Request for Further Comment in particular, for further details.

 

Stakeholder Question	FSRA Response
What sort of consumer education program do you plan so consumers know how/when to complain or what a FP or FA is?	Following the 2020 public consultation, FSRA confirmed that stakeholders overwhelmingly support efforts to educate the public on the Financial Professionals Title Protection Framework (FPTPF). FSRA intends to develop a consumer education campaign to support the implementation of the framework.

Stakeholder Question	FSRA Response
Regarding the requirement for maintaining credentials for titles, will this be a compliance department responsibility/ function within reporting entities to oversee? Is there an audit process to this end from the FSRA and, if so, what are the logistics of such an audit?	FSRA’s updated FPTP Application Guidance outlines FSRA’s approach to administering applications under the FPTPA. As part of the application process, credentialing bodies must demonstrate that they have a process in place to ensure the suitability of their credential holders, both upon obtaining a credential and in order to maintain a credential. FSRA will review these processes upon application to ensure that they meet the minimum standards for approval. In addition, FSRA will continue to monitor an approved credentialing bodies processes to ensure its continued compliance with the Financial Professionals Title Protection Act, 2019 (FPTPA), the Financial Professionals Title Protection Rule (FPTP Rule) and any other relevant terms and conditions of approval.
Will ISO approval and/or standards for CB’s be required?	FSRA is not contemplating prescribing a requirement to obtain national accreditation. Credentialing bodies will be required to meet the minimum standards outlined in the proposed Financial Professionals Title Protection Rule (FPTP Rule) and the associated Application Guidance and Supervision Guidance. FSRA set these standards based on research of the existing licensing and designation bodies in the marketplace. In addition, FSRA conducted research on requirements set by international standard-setting bodies for accreditation, such as the International Organization for Standardization (ISO) and the National Commission for Certifying Agencies, and other organizations that issue a form of credential.
Will CSI as an educational resource (e.g., courses) and its ability to be a CB for the PFP designation be separated to remove obvious conflicts of interest? How will the conflict of interest with CBs enforcing and removing somebody's ability to use the FA/FP titles be managed given the fees involved?	In order to obtain approval as a credentialing body and to offer an FP/FA credential, entities must demonstrate how they meet the approval criteria outlined in the proposed Financial Professionals Title Protection Rule (FPTP Rule), including a proposed requirement for credentialing bodies to have effective governance, administration procedures, and practices that serve the public interest. Through the application process, FSRA will assess the extent to which this standard has been met.  To further clarify its approach, FSRA has amended the proposed FPTP Application Guidance to specifically require applicant credentialing bodies to demonstrate their processes and procedures for identifying, managing, and addressing any real or perceived conflicts of interest.
Are you concerned about enforcement capabilities of some of the organizations that have expressed interest in becoming credentialing bodies, when in fact their experiences to date have been in providing training, education and industry advocacy services?	In order to obtain approval as a credentialing body and to offer an FP/FA credential, entities must demonstrate how they meet the approval criteria outlined in the proposed Financial Professionals Title Protection Rule (FPTP Rule), including a proposed requirement for credentialing bodies to have effective oversight practices and professional standards for credential holders. FSRA will assess these requirements for each applicant credentialing body on a case-by-case basis to ensure that they meet FSRA’s minimum standards for approval.
Is there going to be willingness to enforce rules with respect to CBs? On the LLQP side, it looks like at least two LLQP providers were complicit in exam cheating, and instead of enforcing sanctions against those providers, more compliance was forced on all LLQP providers.	Under the Financial Professionals Title Protection Act, 2019 (FPTPA), FSRA will have authority to oversee approved credentialing bodies. FSRA intends to adopt a risk-based approach to compliance and supervision. FSRA will have the ability to issue a compliance order, and in the most egregious cases, revoke the approval of a credentialing body, where non-compliance has been identified.
How do I know if my professional body is applying as a credentialing body?	FSRA will post the names of approved credentialing bodies and credentials on its website. Prior to publication, individuals should inquire with their existing licensing/designation body for more information.

 

Stakeholder Question	FSRA Response
If we have advisors who already are required to meet MFDA or IIROC requirements, why do we need to meet FSRA’s requirements?	Fulfilling the commitment set out in the Financial Professionals Title Protection Act, 2019 (FPTPA), FSRA will set minimum standards for credentialing bodies and their credentialing programs to ensure that only qualified individuals can use the FP/FA titles. These standards do not currently exist in Ontario.