MFDA funds investor legal aid clinic

Amid rising demand for assistance from disgruntled investors, the Mutual Fund Dealers Association of Canada (MFDA) is providing funding to Osgoode Hall Law School’s legal aid clinic for investors.

The MFDA pledged financial support for the school’s Investor Protection Clinic (IPC) over two years. The size of the commitment was not disclosed.

The clinic was launched in 2016 to provide free legal advice to aggrieved investors who couldn’t otherwise afford a lawyer to pursue their claims. The service is staffed by law students who are paired with practising lawyers.

“Osgoode’s IPC is a great organization and a worthwhile cause. Since its inception the IPC has provided an important public interest function through its focus on protecting investors and after several years of operation the MFDA is pleased to help the clinic to expand its capacity,” said MFDA president and CEO Mark Gordon in a statement.

The IPC said that demand for its services soared since the onset of the pandemic — tripling between May 1, 2020 and April 30, 2021 — and has remained “disproportionately high.”

Law professor Poonam Puri, who heads the clinic, suggested the increase in demand stems from a “perfect storm” of heightened market volatility and strict isolation that “left investors vulnerable to unsuitable and high-risk investment products.”

“The funds from the MFDA will allow us to create added value through client support and investor education, while also helping advance our research to inform public policy and practice in investor protection,” she said.

Last year, the IPC announced a five-year funding arrangement from the industry’s other major self-regulatory organization, the Investment Industry Regulatory Organization of Canada (IIROC).

The clinic was initially founded in partnership with investor advocacy group the Canadian Foundation for Advancement of Investor Rights (FAIR Canada) with funding from The Law Foundation of Ontario.

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.