CSA publishes guidance for know-your-client, know-your-product and suitability obligations

TORONTO, Jan. 9, 2014 /CNW/ - The Canadian Securities Administrators (CSA) today published CSA Staff Notice 31-336 Guidance for Portfolio Managers, Exempt Market Dealers and Other Registrants on the Know-Your-Client, Know-Your-Product and Suitability Obligations (Notice).

Today's Notice is in response to a number of compliance oversight reviews where CSA staff concluded that additional guidance for registrants, such as Portfolio Managers (PMs), Exempt Market Dealers (EMDs), and other registrants who are not members of a self-regulatory organization (SRO) is required to enhance overall compliance with these important regulatory obligations.

"The know-your-client (KYC), know-your-product (KYP) and suitability obligations are among the most fundamental obligations owed by registrants to their clients and are cornerstones of the Canadian investor protection regime," said Bill Rice, Chair of the CSA and Chair and CEO of the Alberta Securities Commission. "We strongly encourage registrants to conduct a thorough review of their current practices in the context of the guidance published today in order to ensure compliance with these obligations."  

The CSA recommends that registrants use the Notice as a self-assessment tool to improve their system of internal controls and supervision, and as a means to promote compliance and manage risk. Going forward, CSA staff will continue to closely monitor registrants' compliance in these areas and will take appropriate regulatory action if necessary to ensure such compliance.

CSA Staff Notice 31-336 is available on various CSA member websites.

The CSA, the council of the securities regulators of Canada's provinces and territories, co-ordinates and harmonizes regulation for the Canadian capital markets.

SOURCE: Canadian Securities Administrators

Carolyn Shaw-Rimmington, Ontario Securities Commission, 416-593-2361; Mark Dickey, Alberta Securities Commission, 403-297-4481; Richard Gilhooley, British Columbia Securities Commission, 604-899-6713; Sylvain Théberge, Autorité des marchés financiers, 514-940-2176; Kevan Hannah, Manitoba Securities Commission, 204-945-1513; Wendy Connors-Beckett, Financial and Consumer Services Commission New Brunswick, 506-643-7745; Tanya Wiltshire, Nova Scotia Securities Commission, 902-424-8586; Janice Callbeck, PEI Securities Office, Office of the Attorney General, 902-368-6288; Don Boyles, Financial Services Regulation Div., Newfoundland and Labrador, 709-729-4501; Rhonda Horte, Office of the Yukon Superintendent of securities, 867-667-5466; Louis Arki, Nunavut Securities Office; 867-975-6587; Donn MacDougall, Northwest Territories Securities Office, 867-920-8984; Daniela Machuca, Financial and Consumer Affairs, Authority of Saskatchewan, 306-798-4160