Office of the Superintendent of Bankruptcy (OSB) announces change to the designation of insolvency professionals across Canada
TORONTO – Wednesday, December 02, 2015 – The federally licensed professionals who administer debt relief services to consumers and companies across the country will have a new name.
The Office of the Superintendent of Bankruptcy (OSB) today announced a formal change in the professional designation that those currently known as Trustees in Bankruptcy must use in advertising. As of April 1, 2016 these professionals will be known as Licensed Insolvency Trustees.
The Canadian Association of Insolvency and Restructuring Professionals (CAIRP), which represents nearly 1,500 trustees and associates across the country,welcomes this change. CAIRP and its members have for many years sought a new designation that more accurately describes the breadth of services they provide to consumers and businesses.
“Canadians need to know exactly where to turn when they can no longer handle their debt payments. The Licensed Insolvency Trustee is the only professional licensed by the federal government to deal with debt restructuring,” said David Wood, Chair of CAIRP.
“CAIRP is pleased that the new designation helps to position its members as the ‘go-to’ professionals best suited to help Canadians understand their options for restructuring debt,” said Mr. Wood.
The new designation also highlights the fact that Licensed Insolvency Trustees offer Canadians a wide range of services and helps to overcome the misperception that they provide only a service of last resort.
Almost one in four Canadians (23%) have personally used or know someone who has used the services of a Trustee in Bankruptcy, according to a recent Ipsos Reid poll conducted on behalf of CAIRP.
The poll also showed that while Canadians trust licensed professionals more than those who are not licensed, a large proportion of Canadians don’t know who has a license and who doesn’t - six in ten (60%) mistakenly agreed that employees of debt settlement companies and credit counselling agencies are federally or provincially licensed debt-relief professionals.
CAIRP is committed to providing consumers with better information about the options offered by Licensed Insolvency Trustees to assist consumers and businesses in financial difficulty, and to clearly distinguish our members from unlicensed service providers.
“The work performed by Licensed Insolvency Trustees is critical to the efficient functioning of the Canadian economy,” said CAIRP President and Chief Operating Officer Mark Yakabuski.
“Thousands of Canadian consumers and businesses are able to make a fresh start because of the services that only these licensed professionals provide,” said Yakabuski.
Economists from Canada and around the world, including those of the International Monetary Fund, have warned that the debt-to-income ratio in Canada is extremely high and could result in increased economic hardship if interest rates rise, or if consumers’ ability to service this debt is challenged by difficult economic conditions.
“Consumers and business owners need to know that when they need help, the Licensed Insolvency Trustee is there to help them fully understand all options available – trustees do not just administer bankruptcies, as the previous title suggested, but have more options at their disposal to assist Canadians in financial difficulty,” Yakabuski said.
The OSB and CAIRP worked together to bring about the official name change. CAIRP repeatedly surveyed its members over the past few years and a large majority agreed that a new designation was necessary.
The new directive will go into effect on April 1, 2016. Canada’s trustees will have a 12-month compliance period at the end of which all forms of their advertising must comply with the OSB directive.
1Findings are from an Ipsos Reid poll conducted between October 20 and October 23, 2015, on behalf of Canadian Association of Insolvency and Restructuring Professionals. For this survey, a sample of 1,005 Canadians from Ipsos' online panel was interviewed online. The poll is considered accurate to within +/ - 3.5 percentage points, 19 times out of 20, had all Canadian adults been polled.