Program leads to enforcement actions with $44 million in monetary sanctions and voluntary payments
The Ontario Securities Commission’s Whistleblower Program has fielded about 650 tips from across the country and from 15 different jurisdictions in its first five years, the securities regulator said in a recent update.
Since its establishment, the first and only compensated program of its kind run by a Canadian securities regulator has paid more than $8.6 million to whistleblowers. It has also been involved in enforcement actions from tips leading to monetary sanctions and voluntary payments of around $44 million.
The OSC’s Whistleblower Program accepts tips on potential violations of Ontario securities law, ensures protections for those who come forward and offers payments of a maximum of $5 million for tips leading to enforcement action.
“The OSC Whistleblower Program continues to exceed expectations and deliver tangible results,” said Grant Vingoe, the commission’s chairperson and chief executive officer, in the news release. Vingoe praised the courage and determination of those who opted to reach out with information relating to securities misconduct in the province.
“These individuals take tremendous personal and professional risks in coming forward, and the protection of whistleblowers is, therefore, a critical component of our program,” added Jeff Kehoe, the commission’s director of enforcement.
These safeguards include keeping the details of cases strictly confidential and taking reasonable efforts to ensure the protection of whistleblowers’ identities.
The news release noted that the program’s operations over the first five years has led to the commission’s first enforcement action relating to a reprisal against an employee whistleblower in 2020, a growing number of tips per year as employees become increasingly aware about the program, certain tips reported anonymously via lawyers and misconduct identified in industries including financial services, natural resources and technology.
Tips have covered reports alleging potentially misleading disclosure to investors, material misstatements in financial statements, illegal insider trading or tipping, market manipulation and abusive short selling, with some reporting individuals possessing specialized knowledge of the misconduct in question. The program only issues awards after the cases have concluded and all appeal rights to appeal have expired.
The commission plans to publish a detailed report in early 2021 providing further information regarding the program’s activities.