Financial Crime in Canada - Too Many Regulators?

• In Event: White-Collar Crime at 75: International Perspectives and Financial Markets

Abstract

Canada is the only country in the developed world that lacks a central financial regulatory agency to police stock market fraud. Instead of one, it has 13, one in each province and territory, plus a central coordinating agency with no statutory power. The largest is the Ontario Securities Commission (OSC), followed by commissions in Quebec (which operates in French), Alberta (now a key oil power) and British Columbia. The Conservative federal government has struggled for decades to establish a national regulator but lost a constitutional challenge in 2013 when the Canada’s Supreme Court declared financial regulation a provincial responsibility.
Canada’s reputation as a haven for financial criminals has been substantiated by statistics showing that the OSC, the agency with jurisdiction over most large international firms, prosecutes ten times fewer securities law violations per firm and twenty times fewer insider trading violations than the much-criticized US Securities and Exchange Commission (SEC). And its average fines per insider trading case are seventeen times smaller.
This article is an in-depth look at the challenges of enforcement in contested terrain, where regional specificities, turf wars, historical differences and inter-provincial rivalries compound the now well documented – and enormous - challenges of governing powerful economic actors.

Author

• Laureen Snider, Queen's University