Report calls on regulators to respond to needs of vulnerable investors

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Canada's investment industry needs to do more to prepare for and respond to the needs of vulnerable investors, many of whom are seniors, states a joint report released Nov. 16.

The report, prepared by FAIR Canada and the Canadian Centre for Elder Law (CCEL), makes six recommendations for change to Canadian securities regulators.

“These recommendations are designed to help the investment industry play a critical role in abuse prevention,” said Laura Tamblyn Watts, senior fellow and staff lawyer at the CCEL, and a co-author of the report. “Right now, they are 'damned if they do, and damned if they don't' report suspected financial abuse.”

Six recommendations made

Among the six recommendations is one to allow authorized individuals within an investment firm to place a temporary hold on trades and disbursements of funds or securities when there is a reasonable suspicion of financial abuse that has occurred, is occurring or will be attempted – or where the client has lost the capacity to provide instructions.

The report also recommends providing a legal safe harbour for investment firms and financial service providers who reach out to appropriately report suspicions of financial abuse or mental incapacity.

The need for a legal safe harbour was identified as a priority two years ago by a multi-stakeholder task force on vulnerable investors hosted by The Investment Funds Institute of Canada.

As published in The Insurance & Investment Journal by The IIJ Staff Nov. 17, 2017 09:45 a.m. 

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