Financial Services Regulatory Authority of Ontario (FSRA) unveils SRO as fifth credentialing body
Nearly 10 months after the move was first proposed, the Financial Services Regulatory Authority of Ontario (FSRA) has officially recognized the Canadian Investment Regulatory Organization (CIRO) as a credentialing body under the province’s title protection framework.
With this announcement, CIRO is now officially the fifth CB under Ontario’s title protection regime, and the fourth for financial advisors in the province.
“By recognizing CIRO as a credentialing body, we are not only enhancing the value and recognition of CIRO members but also bolstering consumer protection and fostering a more competitive financial services sector,” Huston Loke, executive vice president, Market Conduct at FSRA, said in a statement.
Read more: Title protection: New SRO wants to be credentialing body
Under the new framework, CIRO is authorized to credential individuals in four categories as financial advisors:
- Registered Representative;
- Mutual Fund Dealing Representative;
- Portfolio Manager; and
- Associate Portfolio Manager.
CIRO, which became Canada’s single self-regulatory organization for investments in January 2023 through a merger of the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA), was first floated as a CB for Ontario financial advisors in March of last year.
That move sparked strong reactions from across the industry, with some of the most concerned voices arguing it would dilute the effectiveness of financial advisor title protection in Ontario.
“CIRO’s licensees are allowed to enter the framework with only a sales license, raising safety concerns for families, businesses, and consumers entrusting their financial future to underqualified sales-focused ‘advisors’,” the Financial Advisors Association of Canada (Advocis) told Wealth Professional previously.
Read more: CIRO consideration under Ontario title regime raises questions, concerns
“In some ways, it’s a good thing if CIRO becomes a credentialing body,” Ken Kivenko, president and CEO of investor advocacy group Kenmar Associates, told WP in a past interview reacting to the then-proposal. “But the downside is that 75,000 mutual fund salespersons get the title.”
In FSRA’s latest announcement, Andrew Kriegler, president and CEO of CIRO, highlighted the benefits for investors and professionals.
“Accreditation through CIRO assures investors of the high qualification standards of Financial Advisors. It also streamlines the regulatory process for professionals in Ontario, eliminating redundant regulatory requirements and costs,” he explained.
The Ontario Securities Commission (OSC), in collaboration with the Canadian Securities Administrators (CSA), oversees CIRO. FSRA is working with OSC and CIRO to ensure that CIRO’s role as a credentialing body does not lead to regulatory overlap.
To assess the Financial Professionals Title Protection Framework's effectiveness and explore opportunities for improvement, FSRA has committed to a thorough review of the framework by March 31, 2024, including stakeholder consultation.
It will also evaluate proficiency standards for Financial Planners and Advisors and review credentialing body policies, including complaint handling and disciplinary procedures.
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