A forensic accountant says a proposal by the CRTC to end a prohibition on the broadcast of false or misleading news could open doors to unscrupulous financial operators who prey on gullible members of the public.
"I am very surprised that the CRTC appears to be lowering the standard for truth in broadcasting," Charles Smedmor, the managing director of Smedmor and Associates, said in an e-mail on Tuesday "In addition, I am perplexed that the exemption is only for 'lives, health or safety of the public.'"
Mr. Smedmor said the financial safety of the public also deserves protection.
"The current proposal sets a very low threshold for truth. False or misleading information about the investment alternatives (RESP vs. RRSP), economic trends, the stock markets, and potential investments (either specific stocks or a mutual fund) appear to be overlooked," he said.
"This proposed rule would allow a broadcaster to disseminate false financial information and be exempt from CRTC sanction, as the false information did not directly affect the 'lives, health or safety of the public.'"
The CRTC must consider the potential for "malfeasance by dishonest individuals who are promoting stocks, investment funds and tax 'planning' opportunities," said Mr. Smedmor. "That malfeasance could result in financial losses by Canadians."
The CRTC has given Canadians until Wednesday to comment on the proposed regulatory change that took many people, politicians included, by surprise.
It is apparently the attempt by the broadcast regulator to conform with a 1992 Supreme Court ruling that found Charter rights would be violated of people could be charged for distributing false or misleading information.
The CRTC has been broached about the issue intermittently over a number of years by a little-watched parliamentary committee and recently decided that it would make the change. In doing so, it has provoked intense public backlash and outcry from both the New Democrats and the Green Party.