Ottawa moves to create national securities regulator

[jdobbin]

http://www.ctv.ca/servlet/ArticleNews/stor...22?hub=Politics

Ottawa took a long-awaited first step Monday in unifying the country's patchwork of stock market regulators into one national body.

In making the announcement, Finance Minister Jim Flaherty said the country has a strong financial and banking system, yet no national watchdog for the markets.

I'm not sure what I think of a national regulator. On the face of it, it sounds sensible but I wonder if there are widespread problems with present system.

I know for certain that many provinces won't agree with it.

Guess I am looking for a pros and cons argument for it and I never really seen it debated in Canada.

[Borg]

http://www.ctv.ca/servlet/ArticleNews/stor...22?hub=Politics

I'm not sure what I think of a national regulator. On the face of it, it sounds sensible but I wonder if there are widespread problems with present system.

I know for certain that many provinces won't agree with it.

Guess I am looking for a pros and cons argument for it and I never really seen it debated in Canada.

Who regulates the regulator?

Unlike the average canucklehead, I am always suspicious of federal regulatory outfits - all powerful and therefore very dangerous

Borg

[jdobbin]

Who regulates the regulator?

Unlike the average canucklehead, I am always suspicious of federal regulatory outfits - all powerful and therefore very dangerous

So you think there should be no regulator for securities?

[punked]

Sounds like a good idea to me.

[Borg]

So you think there should be no regulator for securities?

Stop answering questions with questions.

You almost got a serious response out of me but once again your superior intellect and your high and mighty entitled attitude loses me

Now go take on the day - if you can

Borg

[fellowtraveller]

I'm all for it, it is long overdue.

Quebec, of course, will turn it into a constitutional crisis whereby Harper is trampling on their God given rights. The OP will have made up his mind by then and will support whatever Harper does not.

[Sir Bandelot]

Gee not very "conservative" are they. If its not a problem, why do it. Because they want the federal government to control.

[Smallc]

This isn't a federal responsibility. Normally conservatives would be up in arms...and they should be. This isn't needed or allowed if all provinces don't agree....as is their right.

Edited June 23, 2009 by Smallc

[fellowtraveller]

If its not a problem

It is a problem, one recognized by several federal govts..

Think about it.

[Smallc]

I don't want to hear any complaints from conservatives at any time in the future when a Liberal government meddles in provincial affairs.

[Borg]

I don't want to hear any complaints from conservatives at any time in the future when a Liberal government meddles in provincial affairs.

Oh waaah!

I have asked the question and no one appears to think it is important

Borg

[Smallc]

I think it's important. I think that either we get the provinces to agree or we do nothing. It's that simple.

[August1991]

When countries as diverse as Iceland, the US, Ireland and the UK, all with centralized regulatory agencies, now face financial market meltdowns, it seems oddthat Canada would want to create a centralized financial regulator. In fact, Obama's latest proposals seem to create a bigger regulatory role for the Fed, in addition to the SEC.

The evidence for the inherent superiority of one big national regulator over competing regional regulators has never been overwhelming. In fact, it does not exist. Looking out over the wreckage of the global financial scene today, one could just as easily conclude that Canada, the only nation without a national regulator, is also the only nation not suffering from a massive financial meltdown.

....

Canada's regulatory system, as former Bank of Canada governor David Dodge famously said, was "perceived" to be a Wild West of the investment world. It turns out Canada was safer than just about everywhere else in the world.

Terence Corcoran

I don't know if I agree with Corcoran here but I think that it's fair to say that the Charest will not surrender any jurisdiction to a federal regulatory agency. I do agree with the Dodge quote. I have never understood the argument that the Canadian financial regulatory regime was stricter than teh American regime.

[Moonbox]

I'm not sure what I think of a national regulator. On the face of it, it sounds sensible but I wonder if there are widespread problems with present system.

I know for certain that many provinces won't agree with it.

Guess I am looking for a pros and cons argument for it and I never really seen it debated in Canada.

I'm 100% in favor of a national regulatory body. The current system is so backwards it's not even funny.

The benefits of a national regulatory body are as follows:

1. Being able to make trades while out of province.

2. Not having to get your securities licenses changed when you move to different provinces

3. Streamlined processes for similar transactions across the country (huge benefit)

4. Being more compatible with the SEC in the United States.

Currently the SEC in the US doesn't want anything to do with our regulatory bodies. There's very little cooperation between them and this is because the SEC doesn't want to have to deal with 9 different regulators with different rules in one country. Since our economies and financial systems are so completely intertwined it's silly for us not to have uniform (or at least reasonably so) processes and laws in regards to securities.

[Moonbox]

When countries as diverse as Iceland, the US, Ireland and the UK, all with centralized regulatory agencies, now face financial market meltdowns, it seems oddthat Canada would want to create a centralized financial regulator. In fact, Obama's latest proposals seem to create a bigger regulatory role for the Fed, in addition to the SEC.

It's not the centralization that's the problem. It's just been bad regulations.

[fellowtraveller]

I'm 100% in favor of a national regulatory body. The current system is so backwards it's not even funny.

The benefits of a national regulatory body are as follows:

1. Being able to make trades while out of province.

2. Not having to get your securities licenses changed when you move to different provinces

3. Streamlined processes for similar transactions across the country (huge benefit)

4. Being more compatible with the SEC in the United States.

Currently the SEC in the US doesn't want anything to do with our regulatory bodies. There's very little cooperation between them and this is because the SEC doesn't want to have to deal with 9 different regulators with different rules in one country. Since our economies and financial systems are so completely intertwined it's silly for us not to have uniform (or at least reasonably so) processes and laws in regards to securities.

You forgot at least a couple more"

5. Having a single regual;tory regime allows for much easier raising of capital and consistent regulation of same.

6. National regulation closes the door on scammers who flit from province to province when they get in trouble in one, reincoproate elsewhere and away they go again

[Moonbox]

You forgot at least a couple more"

5. Having a single regual;tory regime allows for much easier raising of capital and consistent regulation of same.

6. National regulation closes the door on scammers who flit from province to province when they get in trouble in one, reincoproate elsewhere and away they go again

Yep those are some big ones. There are lots more I couldn't think of too.

[jdobbin]

Stop answering questions with questions.

You almost got a serious response out of me but once again your superior intellect and your high and mighty entitled attitude loses me

The question was a serious one. I don't know the pros and cons of a government regulator for securities in Canada and/or whether it should be provincial or federal. I don't know that I have ever heard the debate on the issue.

Now go take on the day - if you can

I think you took this in a way that is way too personal.

My question still stands about whether a national regulator is needed over provincial securities regulators. After that, I wonder whether if it is possible if securities companies could take on their own standards and practices. Should there be a government role aside from ones that cover fraud and theft?

Edited June 23, 2009 by jdobbin

[Moonbox]

After that, I wonder whether if it is possible if securities companies could take of their own standards and practices.

On their own? Without government regulation? That would be 100% totally completely and catastrophically a disaster.

We need regulation, despite what some nuts think, when it comes to securities trading. It's always been and always will be the smart and informed investors making money off the stupid and uninformed (in general).

Government regulation doesn't necessarily prevent this, but it at least helps prevent outright fraud.

[jdobbin]

I'm 100% in favor of a national regulatory body. The current system is so backwards it's not even funny.

The benefits of a national regulatory body are as follows:

1. Being able to make trades while out of province.

2. Not having to get your securities licenses changed when you move to different provinces

3. Streamlined processes for similar transactions across the country (huge benefit)

4. Being more compatible with the SEC in the United States.

None of this is possible under the present system?

Currently the SEC in the US doesn't want anything to do with our regulatory bodies. There's very little cooperation between them and this is because the SEC doesn't want to have to deal with 9 different regulators with different rules in one country. Since our economies and financial systems are so completely intertwined it's silly for us not to have uniform (or at least reasonably so) processes and laws in regards to securities.

The last I heard was that SEC was working for mutual recognition with all our present regulators.

[jdobbin]

On their own? Without government regulation? That would be 100% totally completely and catastrophically a disaster.

Government regulation doesn't necessarily prevent this, but it at least helps prevent outright fraud.

But can't present fraud and theft laws cover this? I have never heard of why the government regulator is completely needed for the task.

I'm not saying we don't need one. I am saying is it possible to do the job within the present rules of law? Isn't it in the interest of securities firms and the financial industry to have oversight of their industry? And is it possible, they could do the job over the government?

Edited June 23, 2009 by jdobbin

[Topaz]

Sounds like the Tories are harmonizing again with the US.....maybe?

[Jerry J. Fortin]

It's not the centralization that's the problem. It's just been bad regulations.

Lets just take the next step in this thread and cut to the chase. The problem that concerns us is in fact a lack of viable regulation which does need to be handled. However once you go there and do that, which is regulating that industry, is not the next step to look at the centralized banking consortium and the fractional reserve system? The entire issue of securities does find itself rooted in the financial industry. That will open a big can of worms.

When looking into the financial system you are going to have to look into the monetary system whether you like it or not. Once you get to this point certain things become apparent. Most nations don't really have control of their own currencies, so their monetary policies are actually useless. Central banks are privately owned and are out of the control of governments. The fractional reserve system has allowed banks to generate huge profits, while avoiding taxation to a large degree. The real cause of income taxes is the result of arrangements to secure payments for government debt to foreign controlled banking interests.

These subjects are a can of worms most politicians really don't want to pick up.

[normanchateau]

http://www.ctv.ca/servlet/ArticleNews/stor...22?hub=Politics

I'm not sure what I think of a national regulator. On the face of it, it sounds sensible but I wonder if there are widespread problems with present system.

I'm in favour of a national securities regulator. The problem here is that Flaherty made an absurd choice by giving the task of creating this regulator to someone who opposes it.

"The federal government has appointed B.C. Securities Commission chairman Doug Hyndman to usher in national securities regulation.

The curious thing about Hyndman's appointment is that he has historically pooh-poohed the idea of national regulation.

As recently as February, Hyndman told the Vancouver Board of Trade that previous reports advocating national regulation "significantly overstate the potential benefits of a single regulator, and ignore its risks."

Another curious thing about Hyndman's appointment is that, if Flaherty wants to convince investors that national regulation will provide better consumer protection, he picked the wrong person.

Hyndman has been B.C.'s top securities regulator since 1987, but he has failed to rein in Howe Street's penny stock crooks. In recent years, the flow of enforcement cases has dwindled to a trickle. Obvious stock frauds are routinely ignored.

In June 2007, for example, Hyndman declared war on the 800 B.C.-connected companies that trade on the U.S. over-the-counter markets and have been seriously damaging Vancouver's reputation. Two years have passed and while the commission has made the local climate more inhospitable for these issuers, not one of them has been subject to disciplinary action.

Investor protection is not the ultimate goal of this national regulatory initiative. Its real purpose is to make life cheaper and easier for issuing companies and dealers. They are the pipers who call the tune, not consumers.

The "transition office" has many political hurdles to leap before it becomes a permanent office, but issuers and dealers must be happy that their man is now firmly ensconced in Ottawa."

http://www2.canada.com/vancouversun/news/s...1cf00a6&p=1

"The transition office has a three-year mandate. Flaherty wants Hyndman to develop a national plan within a year, leaving two years to implement it. The overall budget is $154 million, of which $33 million has been allocated to the transition office.

During this period, Hyndman will work exclusively for the transition office, so he has taken a leave from the B.C. commission. The feds say Hyndman's compensation will be "in line with" his current pay. During fiscal '08, he made $544,000. Fiscal '09 figures are not yet available. As head of the transition office, he will probably make a lot more than $544,000.

Not only will Hyndman get a pay hike, he gets to stay in Vancouver. He will work from an office in Vancouver (separate from the commission offices).

But the move to national regulation, despite what Flaherty says, has never been about consumer protection. There are only a few small consumer groups in Canada, and none have any clout.

Issuers and dealers, on the other hand, are well represented. They pay the filing and registration fees that funds the commissions, which entitles them to call the tune. And the tune they want to hear is not enforcement, it's deregulation.

National regulation achieves this objective in two ways: First, it will be a lot cheaper for issuers and dealers if they have to register with only one national body and abide by one set of rules, rather than 13 provincial and territorial commissions, each with their own rules.

Second, if principles-based regulation is incorporated into the new system, which it surely will, the focus will shift from prescriptive rules of conduct to broad statements of desired "outcomes." This makes life cheaper and easier for issuers and dealers, particularly in compliance areas."

http://www.vancouversun.com/business/Natio...6668/story.html

National securities regulation is a good idea but the Harper Conservatives blew it by giving the task to Hyndman who favours issuers and dealers, not investors.