Will the new SRO shake up title protection in Ontario?

Title regulation in Ontario came into effect this year with the aim of raising industry standards and improving consumer protection. Whether that aim is being achieved remains to be seen, but what is clear is the regime will continue evolving as the new self-regulatory organization (SRO) takes shape.

The Financial Services Regulatory Authority of Ontario (FSRA) has extended the implementation of title protection into 2023, and indicated that the new SRO, which launches Jan. 1, could be part of the regime.

As of March 2022, only those with a FSRA-approved credential from a FSRA-approved credentialing body can use the title “financial advisor” or “financial planner.”

Earlier this year, FSRA said it would focus on approvals and implementation in 2022. Several credentials were approved: four for use of “financial advisor,” and five for “financial planner.”

Approvals and implementation will continue through the first half of next year, FSRA said in a release on Thursday.

“Given our active discussions with approved credentialing bodies (CBs) about public transparency, and our discussions with other potential credentialing bodies, this focus on approval and implementation will continue until June, 30, 2023,” the release said.

Notably, FSRA is in talks with the new SRO.

“[W]e are in discussions with the new self-regulatory organization […] and also the Ontario Securities Commission about the oversight framework should the new SRO apply to become a credentialing body,” FSRA said in its release.

Julia Mackenzie, acting manager of public affairs with IIROC, said in an emailed statement that the new SRO, FSRA and the OSC were considering how the new SRO’s “participation in the framework could be structured to contribute to the public policy goals of the government’s legislation without duplicative regulation or cost.”

No decisions have been made yet, but “we are optimistic,” Mackenzie said.

One FSRA-approved credential, the designated financial services advisor (DFSA) offered by the Canadian Securities Institute, has requirements that reflect current licensing standards, and thus has been criticized as a rubber stamp that would apply to all registrants.

After the DFSA was approved, Jean-Paul Bureaud, FAIR’s executive director, said title protection as a way to raise industry standards was “dead.”

In Thursday’s release, FSRA said it will publish a summary of CB approval terms and conditions and a plan for CB transparency in early 2023.