Canada’s investment industry regulator (IIROC) announced yesterday that it has established a whistleblower service to “take prompt and effective action on reported first-hand knowledge or tangible evidence of potential systematic wrongdoing, potential securities frauds or unethical behaviour by individuals or firms in the industry.”
The whistle blower service is an attempt by IIROC to help channel internal complains to the highest levels of IIROC so that effective action and investigation can take place.
You can view the IIROC news release here.
IIROC is the national self-regulatory organization that oversees the investment dealers in Canada. It sets and enforces rules of proficiency, business and financial conduct of firms and their employees. However, IIROC is a private entity and lacks legislative authority. Therefore, it can ban members and their employees from the industry but is incapable to levying criminal or civil sanctions against persons who have undertaken wrongdoing.
CTV’s W-5 did a feature story back in 2008 where a farmer’s investments were taken from $217,000 to $0 through inappropriate investments and the IDA (the predecessor of IIROC) could not compel the broker to re-pay the client if he leaves the industry.
You can view the news clip here.