The Mutual Fund Dealers Association (MFDA) is one of two self-regulating organisations that “The MFDA regulates the operations, standards of practice and business conduct of its Members and their representatives with a mandate to enhance investor protection and strengthen public confidence in the Canadian mutual fund industry”. They have proposed restricting the use of the title “financial planner” to only those who have demonstrated proficiency by obtaining at least one of six designations.

It’s about time. There are far too many under qualified “financial planners” out there that hold themselves out as someone that you can go to for quality financial advice. Often the only service they really provide is mutual fund or insurance salesperson. I hope the insurance industry soon follows suit. There is a provincial committee that is supposed to be looking at this issue, but I haven’t heard much about it recently. There are actually people out there that work an unrelated day job and moonlight as “financial planners” or “financial advisors” on evenings and weekends. Most part-time advisors have relatively little knowledge or training beyond the minimum licencing requirement to sell the financial product they are promoting. People with good designations (look for CFP, CLU, CIM) are required to follow a code of ethics that put the client’s interest first. Society is not well served by people without the proper training holding themselves out as a “financial planner”.

Unfortunately, as I mentioned before the MFDA is only one of two self-regulating organisations that regulate mutual fund salespeople in Ontario. I would like to see this title restriction applied by the Ontario Securities Commission and the Financial Services Commission of Ontario (FSCO). FSCO is the regulatory body that licences insurance agents and mortgage brokers in Ontario (amongst other responsibilities). I urge you to consider contacting your member of provincial parliament or email Charles Sousa the Ontario Finance minister at [email protected] and encourage him to adopt restrictions on who is allowed to hold themselves out as a “financial planner”. Alternatively, you can call his office at 416-325-0400 or his constituency office at 905-274-8228.

Here are some links to the websites of the organisations I mention above.

FSCO -Financial Services Commission of Ontario- www.fsco.gov.on.ca/en/ – You can check this website to ensure the person you are dealing with is licenced in good standing and if the regulator has ever suspended their licence.
MFDA -Mutual Fund Dealers Association- www.mfda.ca -you can see if your mfda investment advisor is registered and if the mfda has taken disciplinary action against them.
OSC -Ontario Securities Commission -amongst other things you can check if an advisor is registered, find out about investor warnings, file a complaint against an advisor or company.
IIROC -Investment Industry Regulatory Organisation of Canada- www.iiroc.ca – this is the other SRO (self-regulating organisation) that deals with Mutual fund salespeople in Ontario.
FINANCIAL ADVISORY AND FINANCIAL PLANNING POLICY ALTERNATIVES – www.fin.gov.on.ca/en/consultations/fpfa/fpfa-policy-recommendations.html- View their preliminary policy recommendations.
FPSC -Financial Planning Standards Council- http://fpsc.ca/ – The Council sets the standards of what is expected of Certified Financing Planning Professionals. They grant the credential to those individuals that have passed the exams and have agreed to abide by a code of ethics that places the interests of the client first. They have resources for Canadians. Under this link, you can find a Certified Financial Planner (such as myself) who practices in your area.
Article in the insurance journal if you would like to do further reading on this subject -http://insurance-journal.ca/article/financial-planner-to-become-a-restricted-title/

Should you have any questions about this article or anything relating to financial planning, mortgages or insurance please call me at 647-703-4962

Rick Honeyford, CFP

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