Ontario whistleblower program has received 30 tips since July launch

By Alexandra Posadzki, The Canadian Press

TORONTO – The head of Ontario’s securities watchdog says its new whistleblower program has already garnered more than 30 tips since its launch in July.

Under the program, the Ontario Securities Commission offers rewards of up to $5 million for tips that lead to successful prosecution of serious securities law violations such as insider trading, accounting tricks and market manipulation.

OSC chair and CEO Maureen Jensen says the program has been “fruitful out of the gate.”

“People know about this office and are coming to us,” she said.

“I am encouraged by these early results. New enforcement tools like this will help us resolve cases more quickly and effectively.”

Jensen made her comments at the Toronto Region Board of Trade Tuesday in what is her first keynote speech since taking the helm of the OSC.

Several components of the OSC’s program were hotly debated during the consultation process, including how much to pay whistleblowers and whether those involved in the wrongdoing should be eligible for a reward.

The OSC had originally planned to cap maximum reward payments to $1.5 million, but it raised that after experts suggested that was too little to compensate senior executives who risk losing high-paying jobs and being blacklisted from their industries.

At the meeting, Jensen also spoke about the need to improve investor protection by exploring the possibility of banning embedded mutual fund fees.

“We know this would be a major change not only for advisers and firms, but also for investors,” Jensen said.

“And so we must be confident that any reforms are appropriate for the Canadian market. That’s why input from all our stakeholders is necessary throughout this process.”

Jensen’s comments follow an announcement made by the Canadian Securities Administrators in late June about its plans to take the next step in its examination of mutual fund fees.

The organization, which includes the provincial and territorial securities regulators, said it was looking at the issue of embedded commissions or trailer fees and considering banning them. Britain and Australia have banned the fees.

The CSA plans to release a consultation paper later this year.

Follow @alexposadzki on Twitter.

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