The Proposed Guidance would replace the existing KYC and suitability guidance in its entirety and is intended to Current MFDA Rules require MFDA dealers to act diligently and promptly to facilitate the transfer of accounts in an orderly and timely manner. The Consultation Paper seeks comments on recommendations regarding account transfer rules, as those that involve non-MFDA members or certain assets can become complicated. The MFDA is requesting preliminary feedback on issues that contribute to delays in the transfer of assets as well as potential solutions.
Overview of the Council’s Comments:
In our letter, we note that there are technology solutions to assist dealers with the account/securities transfer process, and that while a universal-access electronic public utility system would be an ideal industry solution, there are a limited number of existing solutions offered by ATON (CDS/TMX Group) and FundServ, and some proprietary systems set up by dealers themselves for limited types of assets.
We suggest, to become a universal-access solution, any solution provider would require a pricing mechanism that could facilitate wide availability/accessibility of some subset of limited-use basic ‘utility’ functions (particularly as it is likely that both parties to the transfer must be members of the system) and must be easy to use. We understand, for example, that as a result of user feedback ATON’s next version will include a web-based platform and the ability to attach documents. As a future step, the MFDA, potentially together with other relevant regulators, could work with CDS and others on a utility pricing model with an entry point for small firms.