Specialized Criminal Courts Needed for White-Collar Offenses

A study by Osgoode Law School professor Poonam Puri calls for special courts to go after securities law violators. The study, How Effective is Capital Market Enforcement in Canada?, was discussed at a conference last week in Toronto.

The study finds that:

• Securities regulators in Canada have been historically reluctant to impose criminal penalties
• Judges impose "disappointingly light" sentences because they fail to recognize the impact of corporate crime on the investing and broader public
• Canadian regulators are much less effective than their US counterparts at enforcement

Similar complaints about the weakness of enforcement have been voiced before, for example in the final report of the Wise Persons' Committee on securities regulation in Canada (2003) - section 3 "Weaknesses of the Current Structure" and in a study by two Wilifrid Laurier University professors entitled Do Insiders Play by the Rules? which concluded that there is a "small likelihood" of being prosecuted in Canada for insider trading violations. The study recommends that Canada adopt the much more aggressive US crime-fighting approach.

The debate continues...