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by David Baines

Media outlets are under heavy financial pressure these days. Editorial staff and research resources have been cut to the bone. This is good for the BC Securities Commission, especially when it comes to enforcement matters. Reporters, for the most part, have been reduced to re-writing the commission's press releases, which often portray enforcement actions as regulatory triumphs when they might more accurately be described as regulatory failures.

The problem is amplified when it comes to settlement agreements. Settlements are negotiated in lieu of hearings, thereby depriving investors of a full airing of all the facts of the case. Also, settlements usually involve a lot of horse-trading. To expedite a settlement, the BCSC may water down the allegations, soften the wording, and reduce the sanctions. Key elements of the narrative are often removed with no explanation. That makes it difficult if not impossible to assess whether investors have been well served, or short-changed.

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