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OSC launched fewer cases in 2013 but won more jail time

OSC chairman Howard Wetston said in a statement the commission is “dedicated to delivering a vigorous and active enforcement program” to meet the goal of achieving investor confidence in the markets.

Fernando Morales/The Globe and Mail

The Ontario Securities Commission launched fewer new enforcement cases last year, but completed a far larger total of outstanding cases and won more jail terms for offenders.

The commission's annual enforcement report shows it began 27 new cases in 2013, a slight reduction from 30 new cases in 2012. The OSC said nine of its new cases in 2013 involved allegations of fraud – one of the commission's key enforcement priorities – a decline from 15 fraud cases a year earlier.

The OSC said it concluded far more outstanding cases in 2013, however, many of which had been launched in prior years. It completed cases against 170 individuals and companies, up from 100 in 2012, including 71 cases completed by way of contested hearings before the commission's administrative tribunal. A further 95 cases, or 56 per cent of the total, were concluded with voluntary settlement agreements.

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The OSC said four of its cases were completed in provincial court, and four defendants were sentenced to a total of 63 months in jail. In 2012, the OSC won jail sentences against two defendants totalling 21 months of imprisonment.

OSC chairman Howard Wetston said in a statement the commission is "dedicated to delivering a vigorous and active enforcement program" to meet the goal of achieving investor confidence in the markets.

The regulator expects to ramp up court cases and jail sentences in 2014 after launching a new Joint Serious Offences Team in 2013 as an enforcement partnership between the commission, the Ontario Provincial Police and the RCMP. The team has a mandate to work with the province's attorney general to bring more cases before the courts where harsher punishments and jail terms can be imposed.

The OSC tracks its enforcement activity each year so it can report publicly on one of the highest-profile parts of its mandate as a regulator of the securities markets in the province.

The latest enforcement report comes a month after the Canadian Securities Administrators – an umbrella group for all provincial securities commissions in Canada – released a broader national report on enforcement activity. The OSC's statistics were included in the national report, but there was no breakdown of cases by individual provinces at that time.

The OSC's 27 new cases launched last year account for 24 per cent of the 112 new cases launched by securities commissions across Canada in 2013. The OSC said its cases involved a total of 96 individuals and companies, or about 36 per cent of the 270 individuals and companies named in new cases nationally last year.

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About the Author
Real Estate Reporter

Janet McFarland is the real estate reporter for The Globe and Mail’s Report on Business, with a focus on residential real estate trends. She joined Report on Business in 1995, and has specialized in reporting on corporate governance, executive compensation, pension policy, business law, securities regulation and enforcement of white-collar crime. More

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