Canadian regulators and courts issued orders for restitution, compensation and disgorgement totalling nearly $110 million for white-collar crimes including fraud in the past fiscal year.
Nearly $11 million of that total was ordered in no-contest settlements, in which the accused neither admit nor deny wrongdoing, according to figures released Wednesday by the Canadian Securities Administrators for the year ended March 31.
In addition, the 13 provincial and territorial securities regulators that are members of the CSA imposed just over $77.5 million in fines, administrative penalties and other sanctions for securities law breaches including disclosure violations, fraud, illegal insider trading, market manipulation and other misconduct.
Canada’s securities regulators tend to bring in just a fraction of the monetary sanctions imposed in contested cases against individuals, with funds disappearing to offshore locations, being spent before regulators intervene, or becoming tied up in related tax or criminal matters.
“CSA members vigorously pursue all available avenues to collection outstanding monetary sanctions,” the CSA report says, detailing powers including garnishing wages, seizing and selling debtors’ assets, hiring external services including private investigators and collection services, and registering orders with the courts and enforcing them as court judgements.
“Imposing a monetary sanction and collecting are two entirely different matters,” the report acknowledged. “In some cases, monetary sanctions do not align with a person or company’s ability to pay.”
Cases prosecuted under the Criminal Code in court in which securities regulators supported the investigation led to 12 offenders receiving jail sentences totalling a combined 36 years of jail time, according to the CSA report.
Provincial regulators also supported quasi-criminal cases, which are litigated in court with potential sanctions of fines and imprisonment of up to five years less a day. In the past year, such cases resulted in 11 individuals being sentenced to jail terms ranging from 90 days to three years, according to the report.
Repeat offenders represented 6.4 per cent of the violators whose matters were concluded in the past fiscal year. Three-quarters of the 12 recidivists were prosecuted in court and, of those, seven were sentenced to prison terms, while two received probation terms of 18 and 24 months.
The report said regulatory enforcement proceedings that were concluded by the end of March resulted in 63 individuals being banned from participating in the country’s capital markets, almost half permanently and the rest for between one and 20 years.
As Canada moves slowly towards the creation of a more cohesive cooperative regulator with the federal government — only some provinces are on board and Alberta and Quebec have rejected the plan outright — the CSA reported that there was formal assistance among regional regulators in 42 cases over the past fiscal year. In addition, 82 files were referred among the jurisdictions for further enforcement action, the report said.
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