IDA conference update: Offshore account ownership must be disclosed, IDA says

National securities regulator would save $40 million a year, study says Offshore account ownership must be disclosed, IDA says Retail dealers surviving as profits collapse Market cons facing longer jail sentences, expert says (June 23, 2003) The IDA is moving quickly to match international recommendations intended to combat money laundering. The IDA’s board of directors […]

By Doug Watt | June 23, 2003 | Last updated on June 23, 2003
2 min read
  • National securities regulator would save $40 million a year, study says
  • Bases loaded for securities reform, Oliver says
  • Painless prospecting — Marketing through “advocacy” client
  • Berkshire exec says compliance costs will fell advisors, dealers
  • BONUS TOOL: Asking clients for referrals (a template letter) Back to IDA coference coverage main page

    For non-individual accounts that are already open, firms must obtain the beneficial ownership information and verify it within one year, Bourque told Advisor.ca at the IDA’s annual conference in St. Andrew’s by-the-Sea, New Brunswick.

    The provisions also prohibit account openings for so-called “shell” banks, which have no physical presence in the jurisdiction where they are registered, Bourque said.

    The move comes just two days after the [Organisation for Economic Cooperation and Development] announced similar recommendations relating to disclosure of offshore account information. “We’ve always said publicly that we will be moving immediately when those standards have been set,” Bourque said.

    “We’re acting to ensure Canada stays at the forefront of compliance,” added IDA president Joe Oliver.

    Bourque describes money laundering as a serious problem in Canada. In 2001, an IDA survey identified 13,000 offshore accounts in Canada. Of those, 3,000 were located in non-cooperative jurisdictions and 353 were identified as high risk.

    Bourque says the IDA is looking at those accounts as part of a compliance review and has already made a number of referrals to the association’s enforcement branch and other regulatory agencies, such as the securities commissions.

    “That’s not to say all those accounts are used for misconduct, but those are the ones that provide anonymity and if someone is intent on committing misconduct, this is the vehicle they would choose,” Bourque said.

    The proposed new policy is an amendment to the IDA’s “Know Your Client” rule. “This is simply another aspect of due diligence that must be done by the investment advisor and the compliance department,” Bourque noted. Failure to comply can result in suspension or expulsion from the industry and a fine of up to $1 million.

    • • •

    Filed by Doug Watt, Advisor.ca, dwatt@advisor.ca

    (06/23/03)

    Doug Watt

  • Offshore account ownership must be disclosed, IDA says
  • National securities regulator would save $40 million a year, study says
  • Bases loaded for securities reform, Oliver says
  • Painless prospecting — Marketing through “advocacy” client
  • Berkshire exec says compliance costs will fell advisors, dealers
  • BONUS TOOL: Asking clients for referrals (a template letter) Back to IDA coference coverage main page

    For non-individual accounts that are already open, firms must obtain the beneficial ownership information and verify it within one year, Bourque told Advisor.ca at the IDA’s annual conference in St. Andrew’s by-the-Sea, New Brunswick.

    The provisions also prohibit account openings for so-called “shell” banks, which have no physical presence in the jurisdiction where they are registered, Bourque said.

    The move comes just two days after the [Organisation for Economic Cooperation and Development] announced similar recommendations relating to disclosure of offshore account information. “We’ve always said publicly that we will be moving immediately when those standards have been set,” Bourque said.

    “We’re acting to ensure Canada stays at the forefront of compliance,” added IDA president Joe Oliver.

    Bourque describes money laundering as a serious problem in Canada. In 2001, an IDA survey identified 13,000 offshore accounts in Canada. Of those, 3,000 were located in non-cooperative jurisdictions and 353 were identified as high risk.

    Bourque says the IDA is looking at those accounts as part of a compliance review and has already made a number of referrals to the association’s enforcement branch and other regulatory agencies, such as the securities commissions.

    “That’s not to say all those accounts are used for misconduct, but those are the ones that provide anonymity and if someone is intent on committing misconduct, this is the vehicle they would choose,” Bourque said.

    The proposed new policy is an amendment to the IDA’s “Know Your Client” rule. “This is simply another aspect of due diligence that must be done by the investment advisor and the compliance department,” Bourque noted. Failure to comply can result in suspension or expulsion from the industry and a fine of up to $1 million.

    • • •

    Filed by Doug Watt, Advisor.ca, dwatt@advisor.ca

    (06/23/03)