When news of a whistleblowing award becomes public in Canadian financial circles it usually makes news; not only from the size of the award, but also the very fact that someone has felt it necessary to step forward to bring wrongdoing in the markets to light.
The recent announcement by the British Columbia Securities Commission (BCSC) of the first award under its whistleblowing program is a good example. The award of $25,000 was to an individual whose information contributed to an ongoing enforcement action into suspected misconduct. Across Canada, other regulators have their own whistleblower programs. In 2025, the Ontario Securities Commission (OSC)’s whistleblower program, which was launched in 2016, made a total of $100,000 in payments to whistleblowers, down from the $1.8 million paid to whistleblowers the previous year, when it awarded $300,000 to a whistleblower who exposed market misconduct.
Securities regulators regard whistleblowing as an important tool in uncovering illegal activities that might otherwise have gone undetected. The BCSC, for example, considers a whistleblower as an individual who provides information that meaningfully contributes to an investigation of investment fraud and other serious types of market misconduct.
Why do whistleblowers act? Studies have shown that whistleblowers will act out of moral concern when making their decision, which ranks above feelings about their employer and fear of reprisal. In fact, concern for others was found to be the strongest predictor of whistleblowing.
Since whistleblowing is seen as a public service, it is protected by law. In Ontario, for example, whistleblowing is a protected activity under the Securities Act (Ontario) and the Commodities Futures Act, while in British Columbia, it is a protected activity under the BC Securities Act. Whistleblowers can make their submissions anonymously or submit their tips via lawyer. Both the OSC and BCSC maintain special whistleblowing portals on their websites where tips may be submitted. Securities regulars will work to preserve the anonymity of whistleblowers.
Reprisals against whistleblowers which may take the form of disciplinary measures, demotions, or termination, are taken very seriously. The Securities Act (Ontario) has specific anti-reprisal provisions in subsections 121.5(1), which forbids reprisals against employees who engage in whistleblowing, 121.5(2), which sets out what constitutes a reprisal, and 121.5(4), which provides a legal remedy for employees believing they have been targeted for reprisal. Reprisals against whistleblowers are similarly mandated against under section 168.04 of the BC Securities Act. In a recent Ontario case, McPherson v Global Growth Assets Inc., an employer was found to have unlawfully terminated staff in reprisal for voicing concerns about compliance and was heavily penalized for their actions.
In deciding upon a monetary reward for the whistleblowing activity, regulators will consider the conditions surrounding the action, including the level of personal risk the whistleblower undertook, the timing of the report, the severity the misconduct, and the level of information and cooperation the whistleblower provides. They will also determine if the report meets eligibility criteria, which generally means that the information must be truthful, and that the person must not have been contacted by the regulator previously about the incident, and that they are not a staff member of the regulatory organization.
The type of tips that may be submitted as whistleblower claims vary. It may stem from something as simple as a disclosure document that doesn’t “sit right” with an investor or comments overheard during a social gathering. Or they may be more specific, such as activities that staff members witness or are asked to participate in.
Securities regulators rely upon whistleblowers as part of ensuring a culture of compliance. They serve as the first line of defence in ensuring a fairer and more open marketplace, both protecting investors and market integrity and confidence.
For more information, please call Barbara Hendrickson at BAX Securities Law (647) 403-4606.
This publication is not intended to constitute legal advice. No one should act on it or refrain from acting on it without consulting with a lawyer. BAX does not warrant or guarantee the accuracy, currency or completeness of the publication. No part of this publication may be reproduced without the prior written permission of BAX Securities Law.