Why Securities Regulators Can't Collect Monetary Sanctions, And What They Plan To Do About It

Securities regulators across Canada impose significant monetary sanctions against market participants each year. The CSA recently reported that provincial securities regulators collectively imposed $138.3 million in fines and administrative penalties and $111.7 million in restitution, compensation and disgorgement orders in 2015.¹ This was an increase of 102% from the previous year and the highest amount of monetary sanctions imposed since 2009.

At the same time that regulators are imposing increasing monetary sanctions, they are facing an increasing inability to actually collect these sanctions. For example, the British Columbia Securities Commission has collected less than 5% of monetary sanctions imposed since its incorporation in 1995 and estimates that of the $340 million in sanctions that are outstanding to it, only $0.3 million is likely collectible.² The BCSC's collection rate in fiscal 2015 was 0.58%. These collection difficulties stem from the fact that