Since the Ontario Securities Commission opened its whistleblower program to tips, at least four individuals have filed complaints against one of Canada’s largest private equity firms according to the Wall Street Journal. Officials at the Ontario Securities Commission and a unit of the Toronto Police Service have inquired about the matter with the multi-billion dollar investment firm at issue.
Last fall, only a few months after launching the program in July, the head of the Ontario Securities Commission said that there had been more than 30 tips detailing securities law violations and that some of them involved serious offenses or potential offenses in areas that the agency would never otherwise be able to find. One express target of the program is misstatements in accounting and disclosure violations. The potential reward for reporting securities law violations that result in total monetary sanctions of over $1 million.
The OSC has been accepting whistleblower tips for just over a year now. Based on the history of the SEC program, it is still far too early to expect them to have announced a payout. If they follow the lead of the SEC, they may put out a report of the number of tips acquired through the program in its first year.
This would be an interesting statistic to see and contrast against British whistleblowers, which have been reporting to the Financial Services Authority in the United Kingdom in declining numbers. The FSA has twice declined to offer banking whistleblowers monetary rewards, opting instead for regulations that aim to protect against retaliation, such as the requirement of an internal whistleblower champion within companies.
The WSJ article details a bit about the methodology of the program in Canada. Ontario regulators send tips warranting review to the program’s inquiries team to conduct interviews research before deciding whether to formally open an investigation. Many of the complaints are dismissed without any further inquiry.
The investment firm denied any wrongdoing in a statement released after the WSJ article was published.