Skip to main content
The Globe and Mail
Support Quality Journalism.
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99per week for the first 24weeks
Just $1.99per week for the first 24weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); } //

It is impossible to figure out how many fraud cases are investigated each year, how much money is lost to financial fraud, and whether investigators are targeting the right areas where the problems are most significant, the report said.

Canada needs a national strategy to combat financial fraud, including a centralized system to collect data on fraud complaints and investigations, according to new report by investor advocacy group FAIR Canada.

The study released Monday says numerous police forces and securities regulators in Canada share overlapping responsibility for investigating fraud cases, but there is no national co-ordination to ensure the system is working efficiently.

It is impossible to figure out how many fraud cases are investigated each year, how much money is lost to financial fraud, and whether investigators are targeting the right areas where the problems are most significant, the report said. Provincial securities commissions publish different data about fraud cases they handle, while police forces appear to provide no statistics about fraud.

Story continues below advertisement

"It is difficult if not impossible to get an accurate measure of the prevalence of investment fraud in Canada and the associated harm to Canadian investors," the report said.

FAIR legal counsel Lindsay Speed said better national data about financial fraud would help regulators decide where to target their actions, and would help alert the public about fraud risks.

"Knowing how much fraud is going on our there would really bring attention to the issue," she said in an interview. "The fact there's no measure that gets attention and is publicly available means it doesn't really resonate with investors that there is a significant amount [of fraud] that seems to be going on in the markets."

Ms. Speed said there are a lot of resources to inform investors about fraud, but not all used. For example, investors can check the registration status of financial advisers, but most people don't know where to get the information.

FAIR has previously advocated for a national fraud agency to centralize reporting and enforcement as a way of improving co-ordination. Ms. Speed said more centralization would help ensure cases don't fall between the cracks when police forces can't tackle complex financial investigations.

The report also urges regulators to compile more data on the prevalence of fraud in the so-called exempt market, where shares can be sold to wealthy and sophisticated investors without the need to provide prospectuses approved by regulators. FAIR said it is concerned the exempt market is increasing becoming a gateway to fraud because it is a largely unregulated market, but said more data is needed to assess the risk.

The FAIR report was released Monday at the same time the Ontario Securities Commission published its annual report for last year, showing the progress so far of the regulator's new Joint Serious Offences Team, which was created in 2013 to tackle fraud investigations in co-operation with the RCMP and the Ontario Provincial Police. The JSOT unit launched 14 investigations and laid quasi-criminal charges in provincial court in four cases between May last year and March 31 this year, the report said.

Story continues below advertisement

The OSC's annual report also showed the commission posted a small operating surplus of $1.2-million in fiscal 2014, ended March 31, after recording losses of $7.8-million in 2013 and $4.7-million in 2012. Revenue increased by 13 per cent last year to $98.4-million due to new higher fee rates that came into effect in 2013.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

Follow topics related to this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies