March 5, 2020 Update
The Canadian Securities Administrators (CSA)Canadian Securities Administrators (CSA) The Canadian Securities Administrators (CSA) is an umbrella organization of Canada’s provincial and territorial securities regulators whose objective is to improve, coordinate and harmonize regulation of the Canadian capital markets+ read full definition published for comment proposed amendments designed to clearly outline how registrants can address situations involving diminished mental capacity or the potential financial exploitation of vulnerable clients.
Under the proposed amendments, registrants will be required to take reasonable steps to obtain the name and contact information of a Trusted Contact Person (TCP) from their clients, as well as the client’s written consent to contact the TCP in specified circumstances.
Additionally, the proposed amendments set out the steps that a registered firm must take if they place a temporary hold on a transactionTransaction The process where one person or party buys goods or services from another for money. Examples include taking money out of an account, buying something with a credit card or taking out a loan.+ read full definition due to a reasonable belief that a vulnerable client is being financially exploited, or that a client lacks mental capacity. The proposed amendments also clarify that Canadian securities legislation does not prevent a registered firm from placing temporary holds in circumstances where the firm has a reasonable belief of these concerns.
The proposed amendments were developed together with the Investment Industry Regulatory Organization of Canada (IIROC)Investment Industry Regulatory Organization of Canada (IIROC) National self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada.+ read full definition and the Mutual FundMutual fund An investment that pools money from many people and invests it in a mix of investments such as stocks and bonds. A professional manager chooses investments that match the fund’s goals for risk and return. You can redeem your fund units at any time.+ read full definition Dealers Association of Canada (MFDA).
The comment period closes on June 3, 2020. Read more
August 19, 2019 Update
It’s been a little over a year since the Ontario Securities CommissionOntario Securities Commission An independent Crown corporation that is responsible for regulating the capital markets in Ontario. Its mandate is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair and efficient capital markets and confidence in capital markets, and to contribute to the stability of the financial system and the reduction of systemic…+ read full definition (OSCOSC See Ontario Securities Commission.+ read full definition) introduced its Seniors Strategy. We wanted to provide an update on what’s been done and where we are headed.
The OSC’s Seniors Strategy was developed to respond to the needs of older investors and to better equip registered firms and their representatives to address the challenges that may arise as their clients age. Given the realities of Ontario’s aging population, and the increased complexity of the financial lives of older Ontarians, implementation of the Seniors Strategy remains a priority for the OSC.
The OSC’s vision is a stronger and more secure financial future for all Ontario seniors. The OSC Seniors Strategy seeks to achieve this through a comprehensive action plan of targeted policy, operational, research, educational and outreach initiatives.
We look forward to continued dialogue with stakeholders as we move forward with implementing the various initiatives in the Seniors Strategy.
On June 21, 2019, the OSC, together with the Canadian Securities Administrators (CSA) published CSA Staff Notice 31-354 Suggested Practices for Engaging with Older or Vulnerable Clients (the Notice). With an aging client-base, registrants have expressed a desire for guidance on how to address the changing needs and issues they are encountering when working with older clients, particularly, responding to potential financial exploitation and diminished mental capacity. The Notice highlights red flags of diminished mental capacity and financial exploitation, and provides registrants with suggestions for adapting their practices regarding:
- Know your client and suitability obligations;
- Complaint handling;
- Supervisory procedures;
- Powers of attorney and limited trading authorizations;
- Training employees;
- Identifying trusted contact persons;
- Establishing written policies and procedures for reporting and escalating issues; and
- Communicating with older or vulnerable clients.
In addition to the Notice, the OSC is working with the CSA on developing regulations that would provide registrants with additional regulatory tools if they suspect that one of their clients is being financially exploited or is unable to make financial decisions.
The OSC has been working to build capacity to improve the ways in which we work with older investors. We have partnered with Elder Abuse Prevention Ontario to deliver training and education to our staff members who interact with older individuals, such as when receiving inquiries and complaints, or when conducting compliance reviews or enforcement matters.
We also reconstituted the OSC Seniors Expert Advisory Committee, which is a multidisciplinary group of seniors’ experts, to provide staff with specialized input on securities-related policy, operational, education and outreach activities.
On July 27, 2018, the OSC published Encouraging Retirement Planning through Behavioural Insights, a research report that identifies the barriers people experience when planning for retirement. The report suggests 30 different tactics government, regulators, employers and the financial sectorSector A part of the economy where businesses provide the same or related products or services. May also refer to a group.+ read full definition can use to help remove those barriers to make planning less stressful and simpler.
The OSC will be pursuing further research, including applied behavioural insights, to better understand and meet the needs and challenges of older investors.
Education and Outreach
Financial education and investor outreach form a significant part of our Seniors Strategy. In fiscal 2018-19, we delivered 42 OSC in the Community events targeted at seniors across the province.
In the coming months we will be publishing additional tools and resources for older investors, their families and caregivers who support them, as well as their registered firms and representatives.
A number of new dedicated resources have been added to GetSmarterAboutMoney.ca, including the Retirement Cashflow Calculator, which was created to help individuals plan their cash flowCash flow The sums of cash a business gets in and spends out during a set period of time.+ read full definition in retirement and the RRIF Withdrawal Calculator, which was created to help calculate RRIFRRIF See Registered Retirement Income Fund.+ read full definition withdrawals. In addition, we have added a Resource for Seniors hub on GetSmarterAboutMoney.ca, which provides links to a number of resources for older Ontarians and their families and caregivers in a central online location.
We also recently published a Personal Information Inventory document, which is a fillable form that can be used to collect and store relevant information for a trusted person, including details of relevant legal documents, insurance information, professional advisors, medical professionals, assets, debts, utilities and services, and digital accounts.
For the full picture of how the OSC is addressing the needs of older investors, visit the OSC website to read the complete OSC Seniors Strategy and all of the initiatives we will be pursuing.