TORONTO, Dec. 18, 2013 /CNW/ - The Canadian Securities Administrators (CSA) issued two status reports yesterday regarding consultations on mutual fund commissions and statutory fiduciary duty.
Advocis, The Financial Advisors Association of Canada, is pleased that CSA staff have decided to further discuss and consider the information gathered before determining what regulatory actions, if any, they intend to pursue.
"This cautious and reasoned approach is the right course because there's so much at stake. A wrong decision could have devastating consequences, so we're relieved that the regulators are taking the time to consider all the facts," said Advocis President and CEO Greg Pollock.
Advocis, the largest voluntary association of financial advisors with more than 11,000 members across Canada, is opposed to regulation that would ban trailer fees or impose a statutory fiduciary obligation on advisors.
"Given the varying needs of investors, choice should be maintained – choice in the kind of compensation and the kind of client-advisor relationship that both parties are comfortable with," Pollock explained.
Eliminating embedded commissions would drive up the cost of financial advice, making it unaffordable for hundreds of thousands of middle-class Canadians. This is what has happened in the U.K. where an estimated 5.5 million people could become "financial advice orphans" as a result of the commissions ban. The situation in Australia is no better and has led the new Tory government to consider reversing some of the reforms, including the ban on commissions.
Advocis, The Financial Advisors Association of Canada, is the association of choice for financial advisors and planners. With more than 11,000 members in 40 chapters across the country, Advocis is the definitive voice of the profession, advocating for professionalism and consumer protection. Professional financial advisors and planners are critical to the economy, helping consumers make sound financial decisions that ultimately lead to greater financial stability and independence. Advocis works with decision-makers and the public, stressing the value of financial advice and striving for an environment in which all Canadians have access to the advice they need.
SOURCE: Advocis, The Financial Advisors Association of Canada