Investor Presentaiton
recommend strengthening penalties and introducing a new third party liability that would
apply to lawyers, accountants, brokers, bankers and others who take part in fraudulent
deals. They also suggest modifying the Québec Companies Act to include sanctions against
company executives and officers, particularly when they abscond with company funds.
Lastly, Option Consommateurs favors a sharp increase in penal sanctions together with civil
liability measures that would enable victims to recover the illegally gained funds.
However, in the eyes of Autorité des marchés financiers and various other observers, the
issue is rather a matter of the actual sentences applied compared with what is theoretically
possible. At present, the maximum penalties are hypothetical since the courts impose them
only in exceptional cases. Thus, the Autorité states "... in the majority of regular cases that
do not make front page news like the big scandals, the minimum penalty is applied since
prosecutors cannot invoke particular circumstances to justify a harsher penalty22." This is
why it is advocating increasing the minimal penalties, which would be more effective that
raising the maximum ones.
In order to obtain the desired deterrent effect, it recommends strict enforcement of the
current laws relating to the penalties and fines for white collar crime. More generally, the
Authorité recommends sensitizing all of the parties concerned to the serious nature of white
collar crime so as to obtain changes in the jurisprudence.
Questions
11. Are the penalties imposed for white collar crime severe enough?
12. What measures do you favor to obtain a better deterrent effect?
3.5. Other issues
Several other issues have been raised in the mutual fund sector. Some people have
highlighted the problem of "exit fees" which oblige investors to pay big penalties if they wish
to withdraw their investments from a fund whose investment objectives may change owing
to a reorientation of the fund family or a change in manager. Other commentary has
centered on the role of Autorité des marchés financiers. This body's mission has several
facets that range from financial markets supervision to consumer assistance and
22 AUTORITÉ DES MARCHÉS FINANCIERS, Mémoire préparé dans le cadre des travaux préliminaires (brief
drafted during the preliminary work), p. 43
Consultation paper
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