BAD BROKERS

SIPA's Brokers' Hall of Shame was initiated in 1999 and provided an alphabetical list of Canadian brokers who had been disciplined, charged or found guilty of wrongdoing. Since that time the regulators have started posting information regarding disciplinary hearings and penalties assessed. This information is now available on the Regulators websites and in some cases provided in alphabetical lists. It is expected that with the increased emphasis on co-ordination amongst the Canadian Securities Regulators and efforts towards harmonizing and sharing information there will soon be a comprehensive national list similar to that which SIPA initiated in 1999.   

Contact the regulators in your province to check on your broker; they will tell you if your broker is registered and whether he has been disciplined or not.  They will not disclose whether there have been complaints unless the allegations have been proven. Keep in mind that it could be several years from the time a complaint is first made until the broker is disciplined. Investors should be aware that some of the disciplinary actions may not be associated with mishandling of investor's accounts, therefore you should check with the regulatory authorities to determine the details of the disciplinary actions.

The Alberta Securities Commission (ASC) provides a chronological list of Decisions and Orders that contains public documents about companies or individuals that have been the subject of ASC enforcement proceedings. A search mechanism is provided to search for specific names.

The British Columbia Securities Commission (BCSC) provides an alphabetical list of Disciplined Persons. The Disciplined Persons List is a list of individuals who have been sanctioned by the BCSC since 1987. The list is intended to assist the public and the securities industry in conducting due diligence. The BCSC is the first regulator to provide an alphabetical list of disciplined persons.

The Investment Dealers Association (IDA) launched a new service on their website in October 2003 enabling investors to find disciplinary information dating back to 1997. More detailed information dating back to 1984 is available if an information request form is completed. The website provides a chronological list of Disciplinary Bulletins that detail the outcome of hearings involving Member firms or investment professionals registered to work at IDA Member firms. They include the particulars of the case and resulting penalties. 

The IDA also provides a chronological list of Settlement Agreements. Many discipline matters are resolved without a contested hearing. Where Enforcement Staff and the Respondent can agree on the facts, misconduct and penalties in a matter, this understanding will be captured in a written "Settlement Agreement". A Settlement Agreement outlines the facts regarding the misconduct of a Member firm or individual, and the penalties that Staff and the Respondent agree should be imposed. The defendant must acknowledge and agree that the agreement is an accurate record of the facts in the case and that the penalties imposed are warranted. The Settlement Agreement is then presented to a Panel of the Hearing Committee for review and approval. If the Panel accepts the Agreement, it is then made available to the public. The Panel may modify or reject the Agreement. Staff and the Respondent will either negotiate a new Agreement or proceed to a contested hearing.

Ongoing investigations and complaints that have not been validated will not be disclosed.

The Manitoba Securities Commission provides a search mechanism under Enforcement. By entering the name of a firm or individual you will find related issues. This is one of the better user friendly search mechanisms.

The New Brunswick Securities Commission provides a chronological list of recent Disciplinary Matters that provides details and names of respondents. The search function provided is found to be unsatisfactory.

The Nova Scotia Securities Commission prides and alphabetical list of registrants under  Enforcement Proceedings. Accessing the name will provide statements of allegations, settlements, orders and decisions.

The Ontario Securities Commission provides an alphabetical list of registrants under Enforcement Proceedings issued by the Commission in connection with applications made under the Securities Act (Ontario) since 2000. It provides notices of the Office of the Secretary, notices of hearing, statements of allegation, settlements, decisions, and reasons for decisions. The records of proceedings on the OSC website are only those initiated by the OSC, under the Securities Act (Ontario) or the Commodity Futures Act, and do not include those conducted by recognized self-regulatory organizations (SRO's).