OSC Releases Policy for Whistleblower Program for Public Comment
For Immediate Release OSC
TORONTO – The Ontario Securities Commission (the OSC) today published Proposed OSC Policy 15-601 Whistleblower Program (the Policy), which describes a whistleblower program that would encourage the reporting of serious securities-related misconduct in Ontario to the OSC. The program would be the first of its kind for securities regulators in Canada, and under the proposed policy, a whistleblower could be awarded up to $5 million upon the final resolution of an administrative matter.
“The OSC recognizes that whistleblowers are an incredibly valuable source of information. We are providing strong incentives for them to come forward. Our whistleblower program is well-considered, and we believe it will result in real-time tips on complex securities law matters that may otherwise be difficult for us to detect,” said Howard Wetston, CEO and Chair of the OSC. “This is a game changer for the OSC and our ability to achieve stronger outcomes for investors and the capital markets.”
The whistleblower program is expected to increase the effectiveness of the OSC’s Enforcement Program by giving the OSC access to high quality information about matters such as insider trading, accounting and disclosure violations and registrant misconduct. The program is also expected to entice companies to self-report wrongdoing to the OSC.
The proposed policy was developed after extensive stakeholder consultation and sets out key details about the whistleblower program, including the type of information that may result in a whistleblower award; the criteria that would make an individual eligible for an award; and the factors to be considered in determining the amount of an award.
Under the proposed policy, if there is an award eligible outcome, eligible whistleblowers could receive up to a maximum of $1.5 million regardless of whether the OSC recovers sanction monies ordered, and up to a maximum of $5 million if the OSC does recover funds.
The proposed policy also expands the list of persons eligible to be whistleblowers to include Directors and Officers, Chief Compliance Officers, in-house legal counsel and culpable whistleblowers, provided certain additional criteria are met.
In developing the proposed Policy, Staff considered comments received on OSC Staff Consultation Paper 15-401: Proposed Framework for an OSC Whistleblower Program, which was published on February 3, 2015 for a 90-day comment period. Staff also considered the valuable discussion that took place at the OSC’s June 9, 2015 public Whistleblower Roundtable.
Staff are seeking comment on the proposed Policy by January 12, 2016.
The OSC aims to have a whistleblower program in place in the spring of 2016.
The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices and to foster fair and efficient capital markets and confidence in the capital markets. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at http://www.osc.gov.on.ca
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