IFIC Stresses Importance of Robust, Consistent Suitability Process
Toronto, ON – February 3, 2017 – In a submission filed today on IIROC’s Proposed Guidance on Order Execution Only (OEO) Services and Activities, The Investment Funds Institute of Canada (IFIC) emphasizes the importance of ensuring that investors who receive advice are protected by a consistent and robust suitability process.
“Any proposal that would allow OEO registrants to make investment recommendations without providing suitability and KYC must be considered in the broader context of regulatory reform,” states Paul Bourque, IFIC’s president and CEO, noting that the Canadian Securities Administrators recently issued for comment proposals to increase the standard of care, strengthen suitability and enhance the KYC process.
IFIC’s submission welcomes IIROC’s efforts to clarify what constitutes an investment recommendation, as opposed to simply providing investment information, and reiterates the investment fund industry’s long-standing support for the value of advice in helping Canadians achieve their financial goals.
“There is well-documented evidence that investors with advice save more and have more confidence about their financial future,” Bourque notes. ”We must ensure that investors who seek advice are protected by a robust suitability and Know-Your-Client (KYC) process, no matter which platform they choose.”
The submission calls for a consistent and principled approach to suitability and KYC across regulators and self-regulatory organizations (including IIROC) as essential for consistent investor protection and the efficient operation of Canadian capital markets.
The Investment Funds Institute of Canada is the voice of Canada’s investment funds industry. IFIC brings together 150 organizations, including fund managers, distributors and industry service organizations, to foster a strong, stable investment sector where investors can realize their financial goals. By connecting Canada’s savers to Canada’s economy, our industry contributes significantly to Canadian economic growth and job creation. The organization is proud to have served Canada’s mutual funds industry and its investors for more than 50 years.
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For more information:
Sara Clodman, Senior Manager, Public Affairs