The government has published regulations that would give the Office of the Superintendent of Financial Institutions power to impose monetary penalties for specific compliance violations.

The regulations will replace the current filing penalties, which came into force in April 2002. The main objective of the regulations is to designate the specific violations of the federal financial institutions statutes in respect of which the Superintendent could impose a penalty. The regulations classify violations as being minor, serious or very serious, which triggers the maximum penalty applicable under the legislation. The penalties to be imposed vary depending upon the classification of the violation.

The regulations target only those contraventions that would be subject to little or no interpretation or judgment in determining a breach, notes the discussion provided in the Canada Gazette.

“This ensures that the Regulations are applied consistently and equitably,” it says. In addition to the late and erroneous filing contraventions that are currently dealt with, the regulations designate contraventions of specified legislative provisions or instruments issued under these provisions.

The Administrative Monetary Penalties framework applies to federally regulated financial institutions, bank holding companies and insurance holding companies. Federally regulated pension plans are not subject to the AMP framework.

The administrative monetary penalties regime is not designed to be punitive but is intended to encourage institutions to comply with their governing statute, it explains. “By encouraging compliance, the regime will assist OSFI in pursuing its mandate of protecting the rights and interests of depositors, policyholders and creditors.”