Legal news and trends for Canadian in-house counsel and c-suite executives
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INDUSTRY SPOTLIGHT Another new measure requires insur- ance companies to report "suspicious" transactions — not just those that appear to be obviously fraudulent. Companies are also required to take measures to obtain information about client directors and benefi cial owners of corporations and oth- er entities from which owners or directors can reap benefi ts. Lastly, the compliance requirements call for internal policies and procedures to be developed in house, com- plete with training for all staff involved. In keeping with evolving risks and vulnerabilities, each company's policies are to be reviewed and revised every two years, and all personal information re- garding clients must be kept on fi le for fi ve years. Manulife has spent the past two years preparing for the introduction of the leg- islation, says McKay. Overall, he lauds the legislation as fl exible and conducive to innovation and a customized approach. "It's something we've asked for for a number of years now," he says. "We think it allows us to better utilize our resources to deal with the risks that face our company and ul- timately the Canadian fi nancial services. We're able to take a risk-based approach. We can look at various risk factors within our business — the products that we sell, the distribution channels that we sell it through, our customer profi les, jurisdic- tions, etc. — and really focus our eff orts and resources on the areas that we think represent the highest risk areas." "Th at's not always been the case. What we oſt en end up with is a one-size-fi ts-all approach, and regulators don't always al- low us to do what we need to do from a risk-based approach." Smaller companies, such as broker- intellectual property CONFIDENCE & CARE Discover why many of the world's most original thinkers rely on Bereskin & Parr for IP guidance. One of Canada's leading intellectual property law firms, we combine depth of expertise with a dedication to tailored service that builds lasting trust. ages, will likely face some challenges, he adds. "It does add an element of vague- ness," he says. "You're losing that comfort zone of knowing exactly what a regulator is going to say if they come in and look at what you've done. You really have to take a solid approach to assessing the risks of the company and being able to explain why you did what you did." Th ere are exceptions, says Patrick Veilleux, a litigation lawyer at McCarthy Tétrault LLP who advises private-sector clients on the legislation's compliance. Any registered plans, certain life insur- ance plans, and others that don't have savings mechanisms attached are not subject to the amended law, he says. Still, he agrees compliance will prove www.bereskinparr.com 1.888.364.7311 TORONTO MISSISS A UG A WA TERLOO MONTRÉ A L to be a challenge for in-house counsel. "Essentially in-house counsel are the ones who are going to conceptualize the program and put it into place," he says. "Any reporting entity will have to have a written component to comply with the program, and they'll be the ones to have to determine where in their business they are most vulnerable and put into place ways to counteract that risk. And it's go- ing to be diff erent for every company." 36 OC T OBER 2008 C ANADIAN Lawyer INHOUSE ntitled-6 1 7/30/08 11:46:04 AM