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The Ontario Libertarian Party, “The Party of Choice,” opposes the creation of a national regulator for Canada’s Security Markets

January 16, 2009

Recently, a panel commissioned by the Federal Finance Minister, Jim Flaherty, recommended the creation of a single, national securities regulator with or without the consent of the Provinces.  The Ontario Libertarian Party believes that this is an unnecessary and potentially dangerous power grab by the Federal Government, which will harm and upset the smooth functioning of Canada’s securities markets. This would also be a complete waste of taxpayer’s money and be a potential threat to jobs and Canada’s economy. As the US experience shows, the SEC, the National regulator of the US Securities market was ineffectual in preventing either the $50 Billion swindle by Bernie Madoff, the destruction of Worldcom and Enron earlier in the decade or the mortgage market debacle, which now threatens the world economy.  Since the Canadian Constitution gives responsibility for financial regulation to the provinces, the imposition of a federal regulator will simply add another level of bureaucracy and an additional hurdle for companies to overcome.  This is a prime example of government using a crisis to expand its control. 

Government regulation rarely works and usually makes things worse. With that in mind, we request that the Government of Ontario oppose the creation of a national regulator and also disband the OSC.  Canada’s Securities Markets already regulate themselves through several organizations including: Investment Industry Regulatory Organization of Canada (IIROC), The Investment Dealers Association (IDA), the Mutual Fund Dealers Association (MFDA), The Canadian Security Traders Association, Inc. (CSTA) and the Canadian Life and Health Insurance Association (CLHIA).  These organizations have as their primary objective to protect the reputation of the investment industry among investors and are able to respond to changing conditions and investor concerns.  In contrast, the objective of a government regulator is to enforce laws and regulations which are almost as rigid as if they were carved in stone. 

More government is not the solution. Less government and more choice is the only way to go.

To learn more about the Ontario Libertarian Party, please visit www.libertarian.on.ca.

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