FSCO and DICO should merge, panelists recommend

The new Financial Services Regulatory Authority would include divisions for pensions, market conduct oversight and prudential regulatory functions

The Financial Services Commission of Ontario and and the Deposit Insurance Corporation of Ontario should merge, panelists George Cooke, James Daw and Lawrence Ritchie wrote in a review of FSCO, DICO and the Financial Services Tribunal’s mandates.

They recommend a new Financial Services Regulatory Authority replace the two organizations, and work at arm’s-length from the government. Divisions for pensions, market conduct oversight and prudential regulatory functions would each have its own superintendent and operate independently.

FRSA’s mandate would include working and cooperating with other regulators to apply consistent standards. It would also have authority over and responsibility for self-regulating bodies, though not of cooperative organizations.

The panelists propose the Financial Services Tribunal work independently of the FSRA.

They have no recommendations about Ontario auto insurance rates, though they acknowledge most other jurisdictions use a different rate setting approach. “If this approach was to continue within FSRA, we would be concerned that this activity would unnecessarily dominate the agenda of FSRA to the detriment of other sectors,” the panelists wrote. They highlight three possible solutions: continue rate approval within FRSA, transfer it to a formal rate-setting board or give FRSA the authority for rate regulation.

The panelists brought forth 37 recommendations in total, and accepting feedback until December 14.


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