The RCMP's low-profile securities investigation unit is moving into the Ontario Securities Commission's office in downtown Toronto, saying closer co-operation between both organizations will improve their investigations.
The Integrated Market Enforcement Team (IMET) for the greater Toronto area will complete the shift of its 28 staff members to the OSC's building by April 1, allowing more consultation between the agencies when deciding which cases to pursue and how to investigate them, said RCMP assistant commissioner Stephen White.
"I think it's going to be a lot more efficient and a lot more effective than it has been," Mr. White told reporters Monday.
The national IMET program was created in 2003 and has faced criticisms for years that it hasn't delivered on its mandate to investigate serious frauds in the capital markets. The unit has laid few charges in major cases, and some of its highest-profile cases – including the prosecutions of former executives of Nortel Networks Corp. and Royal Group Technologies Ltd. – ended with acquittals for all the accused.
The RCMP said the Toronto IMET team laid no charges in 2012, but charged seven subjects in 2013 and 11 in 2014.
Mr. White said closer co-operation with the OSC will ensure important securities cases do not "fall through the cracks" and will be investigated by whichever organization is more appropriate considering the circumstances of the crime. The RCMP can lay criminal charges under the Criminal Code, while the OSC must handle cases under the Ontario Securities Act.
The RCMP's IMET team in Montreal already works in the same offices as Quebec's securities regulator, but teams in Alberta and British Columbia still maintain separate offices, Mr. White said.
The move toward closer co-ordination with the OSC comes two years after the OSC launched a smaller joint serious offences team (JSOT) in co-operation with the RCMP and the Ontario Provincial Police, allowing the regulator to lay more fraud charges in court using the criminal powers of its partners. The JSOT team, which includes two RCMP members, has won jail terms against eight people since 2012, and currently has 13 cases before the courts in Ontario and seven more under investigation.
While the OSC and IMET will remain separately run organizations, the success of JSOT has proved the regulators can work together efficiently, spurring more co-operation with IMET.
"It is basically enhancing what we've already accomplished with JSOT on a larger scale," Mr. White said.
OSC chair Howard Wetston said the RCMP's move is "an incredible commitment" to co-operate with a provincial regulator on extremely complex cases.
"From my perspective, this is a profound move on the part of the RCMP," Mr. Wetston said.
He said it is important for the OSC and RCMP to co-ordinate investigations at the beginning, because information gathered by the OSC under its broad regulatory powers cannot be used as evidence in a criminal trial.
Police forces also have powers of investigation not available to the OSC, including the ability to do undercover work and seek search warrants to gather information.
Mr. Wetston said the OSC is continuing its lobbying efforts for a change to the Criminal Code that would allow police to use wiretaps in investigations of illegal insider trading. Currently, insider trading is not listed as an offence for which wiretap approval can be granted.
While the wiretap change would not give the OSC new powers, the RCMP could use wiretaps in joint insider trading investigations with the OSC, Mr. Wetston said.
Ontario's Ministry of the Attorney General has supported the amendment, and the national committee responsible for recommending Criminal Code amendments – the Uniform Law Conference of Canada – has recommended the change to the federal justice minister.
Justice Minister Peter MacKay has not yet acted on the proposal, which would require Parliament to approve a legislative change to the Criminal Code.