ID
2021-013

Type
Policy
Sector
All Sectors
Status
Public comment closed
Date
Comment Due Date

The Financial Services Regulatory Authority of Ontario (FSRA) is increasing its transparency in enforcement actions.

FSRA is now consulting on proposed Approach guidance that outlines how and when FSRA publishes information about enforcement proceedings and investigations. The proposed guidance outlines how FSRA communicates Notices of Proposals, Notices of Intended Decisions, Final Orders and Minutes of Settlement through news releases to increase public and industry awareness. Our proposed approach will provide greater access to information about who and what type of conduct is being sanctioned. As a result, the public, industry and other regulators can be better informed.

Review the proposed guidance and submit your feedback. The consultation period is now open and will close on September 24, 2021.

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Before we begin, please make sure you do not include any personal or private financial information. If your inquiry does require this information be shared with us, please call us at 1-800-668-0128 or email us at contactcentre@fsrao.ca for instructions.

By submitting your content, you agree to have your materials posted on our engagement portal, used in reports and other materials prepared by Financial Services Regulatory Authority of Ontario (FSRA) that may be shared with the public. Content is moderated so that all posts are respectful and professional. The Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c.F.31, applies to all online content.

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Sector Comment Date posted Sort ascending
Life and Health Insurance
[2021-013] Brendan Wycks - Canadian Association of Financial Institutions in Insurance (CAFII)
Response from: Canadian Association of Financial Institutions in Insurance (CAFII)
Response to: Financial Services Regulatory Authority of Ontario (FSRA)
Re: Consultation On Proposed Approach Guidance Around Publishing Information About Enforcement Proceedings And Investigations

Background
The Financial Services Regulatory Authority of Ontario (FSRA) has launched a public consultation on a Proposed Approach Guidance which outlines how and when FSRA intends to publish information arising from enforcement proceedings and investigations, including the sharing of Notices of Proposals, Notices of Intended Decisions, Final Orders, and Minutes of Settlement through News Releases to increase public and industry awareness.

CAFII Comments
In principle, CAFII supports FSRA’s intention to be transparent and publish information about the actions it has taken in response to an industry player’s misbehaviour or lack of compliance with legislation and/or Regulations. We generally concur that transparency in enforcement actions increases public awareness of misconduct and of the sanctions taken to improve consumer protection and deter future misconduct in the regulated sectors; and that a consistent and clear approach to transparency of enforcement also helps to ensure that non-compliant regulated entities and individuals are treated equitably and know in advance when and how FSRA will inform the public that it is taking action for non-compliant activity.

However, we are making this submission to draw out one particular concern.

CAFII is concerned that implementation of FSRA’s Proposed Approach Guidance, as currently worded, may lead to the publication of information arising from an enforcement proceeding or action taken against an industry player even when that business has proactively self-reported an issue to FSRA, taken prompt corrective action, and made restitution to any harmed customers to make them whole.

CAFII members are strongly of the view that when it comes to industry players with a strong track record of regulatory compliance, a policy of publishing information arising from enforcement proceedings and investigations should not penalize nor create a disincentive for such companies to come forward proactively, self-report, and correct the situation when they discover a lapse in regulatory compliance.

When such a lapse does occur and is discovered internally, CAFII members give careful and due consideration to self-reporting the matter to the relevant regulatory authority. Furthermore, such an incident is promptly self-corrected, with a focus on rectifying the situation for any affected customers.

In CAFII’s view, to have a ‘naming and shaming’ publication result from responsible and proactive self-reporting of a regulatory compliance lapse seems inconsistent with the overarching intent of FSRA’s Proposed Approach Guidance.

We therefore urge FSRA to give careful consideration to the scenario described above; to possible unintended consequences that might arise from “letter of the law” implementation of the Proposed Approach Guidance; and to the wisdom of giving itself flexibility and room for judgment to take into account case-by-case circumstances in applying the final Approach Guidance.

Sincerely,
Rob Dobbins
Board Secretary and Chair, Executive Operations Committee


September 24, 2021
Pensions
[2021-013] Kristina Croce McCartney - CAAT Pension Plan
Please find attached the CAAT Pension Plan's response on behalf of Evan Howard, to the proposed Approach guidance on communicating enforcement actions.
September 24, 2021
Auto Insurance
[2021-013] FAIR Association of Victims for Accident Insurance Reform
FAIR Association of Victims for Accident Insurance Reform
579A Lakeshore Rd. E., Box 39522, Mississauga, ON, L5G 4S6
fairautoinsurance@gmail.com

September 24, 2021

FAIR Submission to FSRA Proposed Transparent Communication of FSRA Enforcement Actions No. GR0011APP

FAIR (Fair Association of Victims for Accident Insurance Reform) is a grassroots not-for-profit organization of MVA (Motor Vehicle Accident) survivors who have struggled with the current auto insurance system in Ontario.

Thank you for the opportunity to voice our concerns and our comments are directed toward the auto insurance sector.

We are pleased to see that FSRA is prioritizing transparency in regulating Ontario’s financial services. This will go a long way to promoting awareness and confidence in a sector that directly affects millions of Ontario consumers.

There are over 10 million insured drivers in Ontario to whom the mechanics and day to day operations of insurance companies are a mystery. Since we are legislated to purchase the auto insurance product it’s important that the government take an active and open role in regulating the industry to ensure it best serves the interests of Ontarians. Sharing information about complaints and the resulting enforcement actions regarding these privately run entities by articulating the concerns of the Regulator will ensure more a resilient and effective auto insurance industry through greater accountability.

Investigation Information

If the intent is to deter deceptive or fraudulent conduct and that is weighed against the confidentiality and potential harms to the reputations of those to whom the investigation relates, then we think that consumer protection should ALWAYS outweigh the potential reputational harm to insurance companies. At the core of many of the FSRA complaints are the health and well-being of vulnerable Ontario patients and their access to rehabilitation so minimizing that potential harm should be prioritized. Millions of consumers expect that the government will ensure the quality of the product they rely on and this new transparency is an important step toward that goal.

Discretionary Circumstances

Shining a light on conduct, practices and activities shouldn’t be an optional part of regulating, but it should be a core principal. The application of scrutiny, exposure and sanctions should be evenly applied. There should be very little use of the ‘discretionary circumstances’ described in this document if the goal is to protect consumers by way of a more transparent system. This should not be a place where the FSRA ‘regulatory sandbox’ proposal is used to pave the way to make an order to exempt any person or entity from “any requirement imposed by, or from the application of any provision in the Insurance Act, the regulations or an Authority rule that is prescribed by regulation”. [1] There should be no less light on auto insurers than there are on any other business operating in the province.

Investigation Information

While we understand the need to not preemptively publish the details of an investigation, there should be some sort of investigative marker that indicates when the complaint has or appears to have substance and it is, at that point, that the public should be made aware of the complaint or concerns FSRA is investigating.

Processes and practices

There is definitely a need for more touch points with complainants during investigations. Some of our members tell us that they have no idea of the status of their complaint file and this, in and of itself, is undermining consumer confidence that the regulator is taking any action about their concerns. There needs to be an accessible tracking system built into regulatory oversight to overcome this. It is not an indictment of the parties or a statement of the Regulator to post some details of the progression of a complaint. This is done in great detail in our court system at the Supreme Court of Canada [2] where the markers are when information is received and shared or when actions occur is available to the public. While this is perhaps more detail than FSRA might need or want, it should be noted that Canada Post [3] has a simple system for tracking packages that could also be used as a model to adapt to fill the need for accessible individual consumer information in a less public way.

Enforcement actions

Undoubtedly the complaints system and regulatory enforcement will be improved by the proposal put forward in this document and we would like to see some attention on auto insurers being required to look into how a misconduct complaint may be playing out across their customer base and that harm should also have to be addressed. Insurers who behave badly seldom seem to target just one customer and this is true of overcharging as was recently seen with a multitude of insurers pocketing the HST they deducted from rehabilitation coverage and in the use of personal credit scores in claims handling. Insurers should be made to bear the costs of such investigations as is done by other regulatory bodies such as LSO and CPSO.

In closing we’d like to acknowledge the effort on behalf of the Regulator to promote a higher standard of business conduct in the financial services sectors and enhance public confidence through the creation of a more transparent system to foster a deterrence of unacceptable consumer abuse.

FAIR Association of Victims for Accident Insurance Reform

[1] http://www.fairassociation.ca/wp-content/uploads/2021/04/FAIR-submission-re-Proposal-Number-21-MOF004-FSRA-CEO-exemption-orders-under-section-15.1-of-the-Act.pdf
[2] https://www.scc-csc.ca/case-dossier/info/dock-regi-eng.aspx?cas=37524
[3] https://www.canadapost-postescanada.ca/cpc/en/support/kb/receiving/tracking/how-to-track-a-package-online

September 24, 2021
Life and Health Insurance
[2021-013] Justin Glinski - Canadian Life and Health Insurance Association
Attached please find CLIHA's comments.
September 24, 2021
Property and Casualty, and General Insurance
[2021-013] Kim Donaldson - Insurance Bureau of Canada
Attached is the Insurance Bureau of Canada's response to the proposed approach in communicating enforcement actions.

Sincerely,

Kim Donaldson,
Vice President, Ontario,
Insurance Bureau of Canada
September 24, 2021
All Sectors
[2021-013] Consumer Advisory Panel

September 24, 2021
Life and Health Insurance
[2021-013] Earleen Moulton - CAILBA

September 24, 2021
Pensions
[2021-013] Alison Van De Kraats - Ontario Pension Board
Please see our attached submission to this consultation. If you have any questions, please feel free to reach out to me directly.
September 24, 2021
Life and Health Insurance
[2021-013] Susan Allemang - Independent Financial Brokers of Canada
Attached is the response from IFB to the consultation.
September 24, 2021
Mortgage Brokering
[2021-013] Paul Taylor - Mortgage Professionals Canada
I would suggest a monthly report be published outlining any disciplinary action taken against any mortgage industry license holders. The Real Estate Council of Alberta (RECA) and the Registered Insurance Brokers of Ontario (RIBO) publish these kinds of recaps, with RECA using the publication as an education tool to assist Realtors understanding of their licensing and conduct requirements. Such a report would help increase consumer confidence in the sector and assist brokers when conducting their own due diligence if considering the appointment of a license holder to their brokerage.
September 23, 2021
Auto Insurance
[2021-013] Catherine Allman - Canadian Association of Direct Relationship Insurers
Please find attached CADRI's submission on the proposed Approach Guidance on Enforcement Communications.
September 22, 2021
Life and Health Insurance
[2021-013] Kim Moffatt - HUB Financial Inc.
HUB Financial is supportive of the proposal and agrees this will aid in the protection of consumers and integrity of our industry. It appears FSRA is looking to mirror what other provincial regulators are already posting to public records relating to advisor monitoring and enforcement and is what we would expect to see from a regulatory body.
September 21, 2021
Mortgage Brokering
[2021-013] Ahmed Abdel Latif Mahmoud El Saidi
When an agent's status is disclosed as being
Expired, any other related information should Also be disclosed to let the public be aware
Of any violation and disciplinary actions !
September 1, 2021
Life and Health Insurance
[2021-013] Jennifer Whittier-Haswell - Independent Insurance broker
The proposals seem to reinforce current measures and guidelines that are already in place. I'm wondering what are the timframes for the information regarding any suspensions, terminations or other enforcement actions to remain on public records.
August 25, 2021
All Sectors
[2021-013] Mehara
It is very important the proposed approach guidance to protect people interests. In addition, enforcement, investigations, and complaints was great in all sectors
August 24, 2021
[2021-013] Diane Le Messurier Davidson - self employed financial advisor
I agree with your proposed approach to communicating enforcement actions as it is in the best interest of the public,
August 11, 2021
[2021-013] Robin Ford - Robin Ford Consulting
Very good to see this. I assume you have taken a look at the UK FCA's Enforcement Guide and related documents - https://www.fca.org.uk/about/enforcement. Of course, it is a more complex document than would be suitable for FSRA, but it is a useful benchmark of sorts. You might consider using English spelling eg licence, but I suppose that is a quibble.
August 10, 2021
Financial Planners and Advisors
[2021-013] Anthony DeLuco - 7052561766 #4224
A comment on this particular notice:
If the proposals outlined are novel, I can 't imagine what the FSRA did (in respect to monitoring and enforcement of regulations) before. All of the outlined proposals, in all the fields seem to be what one would expect of a regulatory body!
Am I missing something?
August 10, 2021
Mortgage Brokering
[2021-013] Karen Filice - Cirrius Finance Corp. 10254
It is important for people to know who they are dealing with. Enforcement, investigations, complaints need to be visible to the public. As well, in order to be viewed as professional - we need to keep our industries accountable and professional. That means being accountable and transparent. Those of us who view this as a profession will welcome that.
August 10, 2021
All Sectors
[2021-013] Dan Allen - Dan Allen Financial Inc.
I agree with the transparency only after all inquiries have been completed and final decisions made.
Probably goes without saying, but the reputations of good advisors is at stake if the transparency begins when an investigation commences.
August 10, 2021
No questions have been asked about this consultation yet.