BCSC gets new enforcement powers

Under newly adopted legislative reforms, the B.C. Securities Commission (BCSC) is getting enhanced investigative and enforcement powers, and expanded rulemaking authority.

A set of amendments took effect on July 17 that give the regulator the power to impose sanctions — including penalties of up to $1 million — for failing to comply with a summons or demand to provide information. Previously, the BCSC would have had to seek a court order to hold an uncooperative witness in contempt.

“Now, the BCSC can use its administrative processes to impose swifter consequences — restrictions on market participation and administrative penalties up to $1 million — for failing to comply,” it said in a release.

Additionally, the amendments give the regulator authority to make rules for registrants’ auditors, such as imposing audit standards, and the authority to impose continuous disclosure obligations on all issuers (not just reporting issuers), including pooled funds.

They also empower the BCSC to seek court orders against people convicted of criminal offences involving securities or derivatives, including orders requiring the payment of restitution or damages. And the amendments clarify that pension funds aren’t exempt from enforcement processes, such as preservation or forfeiture orders.

The revisions would also enable the commission to adopt an “access equals delivery” regime for prospectuses, and enable investors to take action when firms fail to provide access.

“The BCSC’s enforcement and collection capabilities were already among the strongest of any securities regulator in Canada,” said Brenda Leong, chair and CEO of the BCSC, in a release.

“These amendments strengthen [the] BCSC’s ability to investigate misconduct and support stronger protections for investors.”

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.