IDA grapples with name game

Tried calling the IDA lately? Since the announcement of the proposed merger between Market Regulation Services (RS) and the Investment Dealers Association, the brokerage industry regulator’s name change and the re-branding of the spun-off trade association have been put on hold.

Let’s imagine the calls they could get:

Caller: Hello, is this the IDA?

IDA: That depends. What do you want?

Caller: I want to talk to someone about my membership?

IDA: Oh, sure we can help you with that.

Caller: Great. I want to cancel my registration.

IDA: If you cancel your registration, you’ll be out of business.

Caller (getting angry): I thought membership with the trade association was optional?

IDA: It is. You need to call the IDA, not the IDA.

Caller: …

IDA: You know, the new industry association that was spun off.

Caller: Exactly! This is the IDA, right?

IDA: Yes. But you want the IDA — IA.

Caller: Oh, thanks for your help. One last thing?

IDA: Yes?

Caller: Can you tell me how I can get this regulator off my back?

Such a conversation hasn’t (yet) been heard at the IDA — the regulator or the industry association — but there is likely no shortage of brokers, dealers and no doubt investors, who are confused by the shared nomenclature of the two organizations.

As Joe Oliver, president of the IDA — the self-regulatory organization that is — pointed out recently, the trade association is already operating entirely independently of the SRO. It’s hard to tell. Not only are they essentially working under one name, they share the same website and even the same office.

The industry association expected to take over the IDA name on April 1, but by then, merger talks with RS were in the advanced stages, delaying the entire process. The question now is whether either organization will want to call itself the IDA. The SRO is waiting until its merger is approved by the CSA before changing its name, but that won’t happen until the fall, at best. And in the meantime, is the industry association willing to live in the SRO’s shadow?

“What that means is the trade association, which wants to use the IDA name can’t because we have to continue using the name the Investor Dealers Association of Canada until such time as we have a new approved name from the [securities] commissions,” says Connie Craddock, vice president, public affairs, for the SRO. “It raises some challenges in communications.”

No kidding. The timing couldn’t be worse. This is the time when the industry association should be actively trying to distance itself from the SRO in order to educate its members on its mandate is as it makes a case for firms to maintain their membership.

“We can understand the dilemma it causes,” says Annie Côte-Kennedy, the new spokesperson for the industry association. “It becomes a little bit difficult to start establishing your mandate and putting that out, but hopefully it will be addressed soon.”

As Côte-Kennedy says, the board is considering all options but the organization is looking to operate with an official name before the fall. An announcement on the industry association’s decision could be announced at the IDA’s annual conference at the end of June.

Until then, be careful what you say. You might not know which IDA you’re talking to.

Filed by Mark Brown, Advisor.ca, mark.brown@advisor.rogers.com

(05/19/06)