Canadian mutual funds may not be out of the woods just yet.
Last week, the chairman of the
But industry watchers say that several issues pertaining to illegal trading practices at mutual fund companies are far from being addressed, according to Reuters. The OSC has drawn criticism from people like investor advocate Robert Kyle, who is skeptical about the OSC's request to firms to voluntarily provide information for the investigation.
Questions also loom over how the OSC determined the settlement amounts it asked of
"It's like the OSC must have looked at their resources and said, 'We don't have the manpower to do it. Let's look at how we can estimate it.' But in terms of the distribution, the OSC is not the one doing it, the fund companies are paying for everything, so they want it to be precise," said Windsor-based mutual fund analyst Dan Hallett. "The way they did it might be fine. But we just don't know."
Unlike the U.S. investigation, the Canadian probe did not disclose the names of the market timers. Hallett also points out that money market funds were left out of the probe. The OSC said the reason for the omission was that money market funds "present no opportunity for capital gains," which Hallett disagrees with.