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Securities Evaluation Essay

2899 words - 12 pages

Chapter-3 Canadian Regulatory Environment
Who are the Regulators?
* Office of the superintendent of Financial Institutions (OSFI) was established in 1987 and is a simple regulatory body for all federally regulated financial institutions
* they look after banks, trust and loan companies and cooperatives, insurance companies and federal pension plans
* they also give advice to the government of Canada
* Canada deposit insurance corporation (CDIC) is a federal crown corporation, provides deposit insurance and provides stability to the financial system
* It insures deposits up to 100 000
* To be eligible deposits must be made in Canadian currency and payable ...view middle of the document...

* In Quebec the regulatory body is neither a securities commission or a securities administrator it is the authorite des marches financiers (AMF)
* The 13 securities regulators of Canada’s provinces and territories joined together to form the CANADIAN SECURITIES ADMINISTRATORS (CSA)
* This is an effort to harmonize regulation of the capital markets
* Its mission is to regulate the system and protect investors from unfair or improper practices
SRO’s Self Regulating Organizations
Self regulatory organizations: are private industry organizations that have been granted the privilege to regulate their own members by the provincial government. SRO’s are responsible for enforcement of their members conformity with securities legislation SRO’S legislation applies to their members in addition to provincial regulations
* Examples include
* IIROC Investment industry regulatory organization of Canada
* This group oversees investment dealers and oversee trading on debt and equity markets in Canada
* Mandate is to set high quality investment industry standards, protect inventors, strengthen market integrity which keeping capital markets efficient and competitive
* IRROC plays the following roles
* Financial compliance: includes monitoring dealer members to ensure they have enough capital to carry out operations
* Business conduct compliance: monitor dealers to ensure policies and procedures are done properly with respect to client accounts
* Registration: overseeing professional standards and educational programs
* Enforcement: enforcing rules and regulations
* Mutual fund dealers association (MFDA)
* Regulates the distribution and sales of mutual funds, they do not regulate the mutual funds themselves as this responsibility has remained with the province
* MFDA Investors protection Corporation gives protection to eligible customers of insolvent MFDA member firms,
* Does not reimburse for market changes
* 1 million dollar coverage

Investment industry association of Canada (IIAC)
* It is a member based association the represents the interest of market participants, such as securities firms, discount brokers and retail and boutique firms
Canadian Investor Protection Fund
* This is investing public protection from failures of firms
* Primary role of CIFP is investor protection and secondary is to oversee the self regulatory systems
* The fund protects eligible customers in the event of insolvency of an IIROC dealer member
* They do not cover losses that result from market losses only dealer members who firms fail
* General and separate accounts are a classification of accounts a client might own and are each capped by a maximum that can be claimed for them
* An example of a separate account would be RRSP’S, RESP...

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