Utpal Bhattacharya is the best Canadian Investment Sorry for the delayed response as this board is closed so I will email you the response as well.
Not quite sure where you get your information from. – Multiple sources globally but easiest for you would be direct from ASC publication enforcement report that they release annual about Canada. https://www.albertasecurities.com/news/ASC%20Publications/6116/CSA%202012%20Enforcement%20Report.pdf
Canada is ranked #2 in the world for investor safety, behind New Zealand. – Unsure what assessment methodology was used so please list this source so I can breakdown. Although I am unsure of your source I am fairly certain this is your interpretation of their data. Here are some facts as to why New Zealand investor safety is lower than you think and does not support your #1 ranking:
1. They do not even protect their term depositors- Reserve Bank of New Zealand (RBNZ) recently released an ‘Open Bank Resolution’ (OBR) policy. This sets out what it could do if a bank went to the wall, and is focused on preventing contagion. The key implications of this policy for term deposit holders are twofold:
a. The RBNZ has rejected deposit insurance as an effective tool
b. In the event of a crisis, deposit holders may have some of their deposit frozen and potentially forfeited.
2. Their own oversight committee states they are deficient - FMA report outlined three areas where NZX needed to focus further efforts in 2013: managing potential conflicts of interest, enforcing compliance and board reporting and oversight.
Recommendations related to these points included developing an overarching Enforcement Policy to clarify NZX's enforcement objectives and considering ways of providing the market with information on enforcement activity.
The FMA also suggested developing a mechanism for overseeing and assessing exercise of the regulatory delegations and the quality of regulatory decision-making.
Unfortunately this is the same recommendation they were asked to incorporate back in their 2009 report.
https://media.nzherald.co.nz/webcontent/document/pdf/securitiescommissionreport.pdf
And they are the same deficiencies the IMF reported back in 2003.
3. They even failed the fund test - In May 2009 Morningstar published a report on mutual fund investor experience in 16 jurisdictions. New Zealand was ranked last with an overall rating of “D-”. It scored particularly badly for the transparency of prospectuses and shareholder reports.
As to your comment about the ASC having the worst securities enforcement track record, I trust you have the means to substantiate that statement. – Everyone in Canada has access to this information. https://www.albertasecurities.com/news/ASC%20Publications/6116/CSA%202012%20Enforcement%20Report.pdf
I would be very interested in you showing all of us where that is stated. – Here is the link - https://er-ral.csa-acvm.ca/
Because they changed their fraud reporting this year I encourage you to read the previous five years to extrapolate data.
I have done a great deal of research on the various regulators across Canada, and in other parts of the world. Then you would know the expert in the world on this also did a report for the Canadian Task Force Utpal Bhattacharya Abstract:
Theory suggests that enforcement of securities laws is important. If securities laws are not enforced, outside investors will doubt whether they will get their money back with a fair return. So outside investors will not give their money to firms (this leads to low liquidity in capital markets) or, if they give money to firms, they will demand a higher return (this leads to a higher cost of equity). There is little literature documenting the importance of enforcing securities laws. On December 8, 2005, I was asked by the Task Force to Modernize Securities Legislation in Canada to survey the little literature that exists, and prepare a report titled "Enforcement and Its Impact on Cost of Equity and Liquidity of the Market". https://scholar.google.ca/citations?user=s899WjYAAAAJ&hl=en
Force to Modernize Securities Regulation in Canada https://thievesofbaystreet.ca/wp-content/uploads/2012/02/Utpal-Bhattacharya-2006-Taskforce-Report.pdf
Force to Modernize Securities Regulation in Canada https://thievesofbaystreet.ca/wp-content/uploads/2012/02/Utpal-Bhattacharya-2006-Taskforce-Report.pdf
In Canada the ASC leads the way on many matters such as systemic risk evaluation, and in fact with Quebec have done a very effective job of enforcement, compared to a jurisdiction such as Ontario. – Actually New Brunswick leads and I have provided the links to all the reports for you to digest.
You mention the ASC lost a case recently, In fact they have lost other cases as well but you also failed to mention they successfully prosecuted the Everyready insider trading case, and other similar cases. – There is no other case like Everyready and if you read it you would comprehend that how expensive it was to the clients like Dr. Bratvold who was probably their star witness and how many higher up the food chain have already settled privately or put in their the judgment up for an appeal https://albertasecurities.com/Enforcement/Enforcement%20Orders/BRATVOLD%20Jeffrey%20Scott%20SAU%2020120522%204198323v3.pdf
You will not win every case.- more glaring is even when they win they do nothing to collect - FAIR has studied the record of sanctions collection by Canada’s self-regulatory agencies and pushed for the OSC to provide details. - Between 2005 and 2011, the commission collected slightly more than 70% of the $155.5-million in monetary sanctions and costs from settlements, but less than 1% of the $73.4-million in financial sanctions meted out at the conclusion of contested hearings.In total, less than 50% of the sanctions from that period have been collected to date. https://business.financialpost.com/2012/01/18/osc-enforcement-leaves-money-on-the-table/
If you think Alberta fared better it is well known they had and have way bigger issues because they are internal
https://investorvoice.ca/PI/1819.htm
|
ASC issues raised year ago
|
|
Letter to government: Former senior enforcement officer outlined concerns
The government viewed Mr. Alford as a credible complainant, and as a result hired Robert Clark, a former Alberta ethics commissioner, to investigate the allegations of misconduct. However, sources say Mr. Clark was unable to convince other potential complainants to co-operate and the probe ended. Even so, the provincial government decided not to reappoint Stephen Sibold, chairman of the provincial securities watchdog, to a second, five-year term.
The former enforcement director wrote that he brought his concerns to the attention of three ASC commissioners, but to no avail. "I was told not to 'rock the boat' as I too may someday wish to once again access the trough," he wrote.
|
I studied that case and the downfall of the allegations was that the coal market is based on yearly tonnage and is one of the few industries where quarterly financials do not carry as much weight as the annual financials. The company did see their shares fall quarter over quarter and they were selling at the time, and it would easily be construed as insider trading but for the simple fact, which the ASC panel pointed out, that the coal industry works on annual tonnage, not quarterly tonnage.
No the allegations were they traded on material information. In May before they released their first quarter results which missed production the CEO, CFO , and a few others dumped their stock.
The ASC panel also pointed out the responsibility of insiders to ensure they conduct their insider trading with the facts in mind that what they are doing may easily be perceived as insider trading and they must be careful how it appears (sellling when the market for their shares is falling while in receipt of undisclosed iformation which did not pass the scrutiny of material information due to the annuals being more important). – No they did worse and released a memo to all markets participants “of the care and scrutiny” that must be taken to ensure all material information is disclosed before insiders buy or sell shares which showed they lack of will to enforece. I encourgage you to spend more time understanding how the cost of equity actually rises when a country has insider trading laws but fail to enforce them.
When no Law is better than a Good Law
https://www.cepr.org/meets/wkcn/5/5514/papers/BHATTACHARYA.PDF
When you said "material insider case" di you mean "important". –No I meant easy as it has dates and recordable facts.
You should take a look at the other regulators across Canada and determine just how successful, or not, they were in the enforcement area. Alberta is the second largest capital market in the country, with a very large exempt market (both by public and private issuers) including the offering memorandum exemption which Ontario does not have. – I have. You should compare Canada to other regulators like the leading expert in this field “When scaled by the size of the stock market the SEC prosecutes 10 times - 20 times more cases for all securities laws violations than the OSC prosecutes. A detailed examination of insider trading cases shows that the SEC resolves the cases faster than the OSC, and fines 17 times more per insider trading case than the OSC does.”
As well as having a very healthy economy, fraud takes up residence in a healthy economy where there is disposable income and high income levels. – Fraud takes place in poor and healthy economies but the price of capitalism is eternal vigilance.
Sorry, I took up far too much space here. Can you please post your information that points to the ASC having the worst enforcement record in the country. I obviously missed that and would love to read it. Looking forward to seeing the link. – It is my goal to break the cycle of unbiased Financial Advice which is always wanted but rarely followed.
Got to love timing - when one of my top ranking investment countries and global watchdogs just reported a BNN favorite
https://www.iosco.org/investor_alerts/
https://www.finanstilsynet.dk/en/Nyhedscenter/Pressemeddelelser/2013/Advarsel-mod-Arrow-Capital-Management-Inc.aspx