The OSC’s draft statement of priorities

Nebulous, bland, soporific and meaningless: that is my pronouncement of the OSC’s draft statement of priorities for 2013 to 2014

FAIR Canada’s submission on this “round square” of a missive alludes to some of my many frustrations and quite possibly their own:


“FAIR Canada suggests that the OSC provide more concrete success measures for several of its priorities. We do not believe that vague, subjective success measures will serve the OSC in its efforts to be transparent and accountable.”

“FAIR Canada suggests that during the OSC’s “mystery shop” research sweep of advisors the OSC also consider whether advice that is considered to be “suitable” meets investing consumers’ expectations of advice1 and whether it instils investor confidence in the capital markets.”

“We recommend that in addition to publishing an initial assessment of the application of a best interest standard for advisers and dealers, the OSC publicize concrete steps it plans to take to move forward with this initiative, given the significant length of time it takes to make real, meaningful regulatory change.”

“FAIR Canada urges the OSC, together with the CSA, to do more than “advance the discussion of mutual fund fees”. Following the mutual fund fees roundtable, we would like to see the CSA, lead by the OSC, identify options and issue recommendations in order to make progress in this area.”

“FAIR Canada urges the OSC to give priority to initiatives aimed at preventing misleading advertising that encourages advisors to recommend and consumers to invest in products that will not deliver what is promised. In particular, advertising that promotes products as “tax efficient” and return of capital income funds that are not clear that the stated rates are not earnings but rather are distribution rates require regulatory intervention.”

“..the need for the OSC to address inappropriate recommendations to borrow to invest (leverage), including improper relationships between dealer firms and financing companies. We recommend that CSA members, including the OSC, immediately preclude advisers and dealers from charging asset-based fees on monies that are borrowed for investment purposes and prohibit the acceptance of trailing commissions in respect of amounts invested using borrowed funds”

“..extend fund facts to other investment products so that consumers have a summary document prior to sale;”

I would go on if I thought the statement of priorities was of value and if a comment on such was likewise.  If it were not for the fact so many fires have been started with little obvious intent, I would say that the industry is indeed lucky to be protected by these vast walls of ignorance!   Again, where is the vision and the direction behind all these consultations and discussion papers?   If all they are doing is stirring up and annoying the respective communities then what can possibly be achieved?

Perhaps the regulators think that investors and their advocates and the industry will come to some amicable agreement without their taking a definable stand!  Is this realistic? No!

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