On November 19, 2018, the Alberta Securities Commission, the regulatory agency responsible for administering Alberta’s securities laws, implemented its first whistleblower program through the enactment of ASC Policy 15-602 Whistleblower Program and corresponding amendments to the Alberta Securities Act.
Before the enactment of ASC Policy 15-602 Whistleblower Program, Alberta did not possess protection for a whistleblower who reported a breach of securities legislation. The only laws that a whistleblower could potentially seek protection under were certain provisions of the Canadian Criminal Code, Public Servants Disclosure Protection Act, and the Securities Act. This patchwork of provisions did not provide much protection under the law. Many considered it an ineffective whistleblower program.
After the 2008 financial crisis many Albertans were left struggling. Out of this need for extra income, more individuals were falling for Ponzi-like schemes and losing substantial amounts of money. Whistleblowers could have come forward and stopped this from happening; however, no one was willing to take that risk without any protections or incentives in place. This motivated the Alberta Securities Commission (ASC) to enact ASC Policy 15-602 Whistleblower Program, thereby amending the Alberta Securities Act (the Act) and creating the Office of the Whistleblower.
Who Can Be A Whistleblower In Alberta?
Under the Alberta Securities Act, a whistleblower is defined as an employee of a person or company who voluntarily reports a breach of Alberta securities laws by the person or company to the ASC. The term “employee” is widely interpreted. It includes a full-time or part-time employee, an independent contractor, an employee or director of an independent contractor working for a person or company, as well as an employee or director of an affiliate of a person or company. Of note, a person will not be considered a whistleblower if the reported breach is misleading or untrue.
What Protections Can A Whistleblower Receive?
Under the Act, a whistleblower’s identity, and any information that might disclose a whistleblower’s identity, is confidential. This information will remain confidential and will not be revealed unless it is necessary to prove that the accused did not commit the alleged breach. The whistleblower is also protected against reprisal. The term “reprisal” is broadly interpreted and includes any conduct committed by a colleague or employer that adversely and materially affects the employment or working conditions of the whistleblower or the whistleblower’s family. If a whistleblower believes a reprisal has been made, the whistleblower must submit a Reprisal Reporting Form, found on ASC’s website, to the Office of the Whistleblower. If the ASC finds that a reprisal has been made it may impose sanctions.
The Act also created a civil right of action for the whistleblower to claim damages against the colleague or employer that committed the reprisal. These protections apply to all whistleblowers who report misconduct in good faith, regardless of whether or not the report results in an enforcement action.
How One Blows The Whistle In Alberta, Canada
The Program encourages the whistleblower to report misconduct to their employer before submitting it to the ASC however, it is not mandatory. Reports can be made to the ASC by phone, email, and regular mail. If submitting a report of misconduct by mail or email, the whistleblower must complete the Whistleblower Submission Form found on the ASC’s website. The whistleblower must mail the completed Form, as well as any supporting material, to the Office of the Whistleblower. Supporting material should include a description of the material, how the material was obtained, and whether the material might reveal the whistleblower’s identity. An attorney may submit a report of misconduct on behalf of their whistleblowing client. In this instance, the attorney must complete and submit the Whistleblower Counsel Submission Form, found on the ASC’s website, on behalf of their client.
The Take Away
Following the approach taken by Quebec in its Autorité des marchés financiers, the Alberta Securities Commission declined to include a financial reward in its Whistleblower Program. Alberta determined there was not sufficient evidence to prove financial rewards produced more whistleblower tips. The two Canadian provinces believe confidentiality and protection against reprisals are all that is needed to incentivize whistleblowers into coming forward. Of note, the Ontario Securities Commission came to the opposite conclusion, and included a whistleblower reward of up to $5 million for tips that lead to an enforcement action. Coincidentally, the three Canadian provinces established whistleblower programs within the past several years.