As reported in a number of previous AUM Law bulletins, the Financial Services Regulatory Authority of Ontario (FSRA) had released Rule 2020-001 Financial Professionals Title Protection under the Financial Professionals Title Protection Act, 2019, the purposes of which are to ensure that people providing financial planning or financial advisory services are qualified to do so and to help alleviate consumer confusion. The Financial Professionals Title Protection Rule and a related fee rule have now been approved by Ontario’s Minister of Finance and the Act was proclaimed into force on March 28, 2022. As a result, individuals operating in Ontario will no longer be able to call themselves “financial planner”, “financial advisor”, or any title that can reasonably be confused with those titles, without holding a recognized credential from a FSRA approved credentialing body. As such, individuals will be required to meet minimum educational requirements and abide by a code of conduct set out by the credentialing body.
An appendix to the Approach and Interpretation Guidance – Financial Professionals Title Protection – Supervisory Framework (Supervision Guidance) provides examples of titles that FSRA considers could reasonably be confusing to clients, to help provide clarification to market participants. It is expected that approved credentialing bodies will be announced shortly. There are a number of requirements set out for approval as a credentialing body, including having policies and procedures in place to ensure that credential holders put the client’s interests first and to ensure the fair treatment of consumers.
There are transition periods available to persons not yet holding a recognized credential; four years for the financial planner title and two years for the financial advisor title from March 28, but only if those titles were already in use as of January 1, 2020. Please contact your usual lawyer at AUM Law if you have any questions on the implementation of these new rules.
March 31, 2022