: Dennis Yanke - Submission

Dear Sirs, thank you for taking a moment to read this submission. I have included in the body of this text the salient points which my association has outlined perfectly. I only wanted to ask one additional question. What would you think if a committee was formed to make some very fundamental decisions about your profession and, there was not one person from your profession on that committee? People could address that committee all day long and the committee members would not understand the nuances of how you practice your profession. I submit you would be very concerned.

All of us are concerned about the mounting debt of households in Canada yet there seems to be no concern at all about the new Federal and provincial debt. Perhaps the numbers are just to enormous for most people to conceive. Bill 157, a unanimous piece of legislation, died on the order paper and your committee was formed to take the next step. If that bill had been enacted a significant burden would have passed from the bureaucrats to associations like Advocis. Not only are we much better at policing our own, we do it for a fraction of the cost. The government would have had a significant cost savings for ever built into much better protection for the citizens of Ontario. I am happen to share the facts of a court case in Kitchener which I advised the police to take action on 2 years and over $100 million dollars of lost savings later, if you wish.

I am astounded that you found no merit in a bill which had unanimous approval by our politicians. Is it your expert opinion that every politician in this province was wrong?

Best Interest Duty

We’ve been asked the question, why financial advisors would we oppose a best interest duty? The simple answer is that we do not oppose a best interest standard in principle, but we do have serious reservations with respect to who applies and interprets that standard. I believe it is important for the Committee to understand that for over 50 years, Advocis members have voluntarily adhered to a code of professional conduct that includes acting in the client’s best interest or a best interest standard. So let me be clear—we support an industry where all financial advisors are held to a best interest duty however we cannot and will not support a best interest duty that is applied and interpreted by a regulator that does not include Financial Advisors in its membership. To move to a best interest standard and leave the oversight to existing regulators - will not work - as the role of the advisor has evolved to the point that the existing regulatory structure cannot support the specialized work provided to clients by the advisor. While Advocis exercises a best interest standard, we want to be clear that it’s our position that a best interest standard can only be interpreted by the profession itself.

The need for regulation

We agree that financial advisory and planning activities should be appropriately regulated in Ontario. The work that financial advisors and planners do is critically important to the financial well-being of the public, so we agree that there should be high professional standards in place that consumers can trust.  Financial planners with specific designations like the CFP should not be regulated as separate and distinct profession.  All advisors should fall under one professional regulatory framework, overseen by professional financial advisors like every other major profession in the province.

A fractured approach to regulation is wrong

The Expert Committee is recommending that Ontario maintain a fractured regulatory structure, with advisor oversight in the hands of the MFDA, IIROC, FSCO and so on, and even a new Financial Services Regulatory Authority. This would mean that advisors and planners would continue be regulated by entities that do not consider them to be members, and which often do not fully understand what they do. This leaves a situation where advisors are regulated without meaningful representation. With close to 40,000 advisors in Ontario, it is time that advisors have a real voice in their regulation and not be considered mere “approved persons” of those with a seat at the table.

Dennis Yanke CFP CLU ChFC