Nagic magnetic tiles are a popular educational toy that combines creativity, problem-solving, and scientific concepts. These tiles are made up of different geometric shapes, such as squares, triangles, and rectangles, that are magnetized on the edges, allowing them to easily connect and form various structures. One of the main advantages of nagic magnetic tiles is that they can be used by children of all ages. Younger children can use them to develop their fine motor skills and hand-eye coordination by simply sticking the pieces together. As they grow older, they can start exploring more complex structures and patterns, enhancing their spatial reasoning and critical thinking abilities. These tiles provide numerous opportunities for imaginative play.
These tiles provide numerous opportunities for imaginative play. Children can build houses, cars, animals, and so much more with these versatile pieces. The magnetic attraction between the tiles also adds an element of surprise and delight, as structures can be easily manipulated and transformed.
Insights & Articles
In July 2016, the Ontario Securities Commission (“OSC” or “Commission”) launched the first whistleblower program (“Program”) in Canada to provide compensation to “whistleblowers” for confidential tips that result in successful prosecution of individuals engaged in corporate misconduct. In February 2018, Anna Markiewicz of our firm explained the Program in an article that can be found here. This article provides key Program updates that have occurred since February 2018 and our views on the potential challenges faced by the Program in evaluating its success.
The Number of Tips Received and Awards Paid Out
On June 29, 2018, the OSC released its first (and only) update on the progress of the Program. [1] It disclosed that the Program had generated approximately 200 tips since its inception and that approximately 7% of those tips resulted in “active investigations” by the OSC’s Enforcement Branch, the branch responsible for investigating and litigating breaches of the Securities Act.[2]
In particular, at the time of the update, 19 of the tips received warranted further action and were referred to OSC’s Enforcement Branch and 15 of the referred matters resulted in active investigations. To preserve the confidentiality of the tipsters and the integrity of the Program, the particulars of those active investigations will not be released to the public. The update further disclosed that 68 (or 35%) of the tips were in the process of being shared with another OSC branch or another regulator for further action. The update also noted that 45 (or 22%) of the tips were under review.
The above suggests that almost half of the tips received by the OSC warranted further action. The numbers may be even higher depending on the outcome of the tips that were still under review at the date of the update. This speaks to the potentially high quality of the tips that are being received from the public.
On February 27, 2019, the OSC announced that it had made its first payments under the Program. It had paid out a $7.5 million award to three whistleblowers who had disclosed misconduct on three distinct enforcement matters. The information provided by the whistleblowers was described as “high quality, timely, specific and credible information”.[3] However, the OSC did not provide details on the quantum of payment for each individual matter.
The OSC anticipates that this payout will incentivize more individuals to “blow the whistle” on corporate misconduct. In response to the announcement, Maureen Jensen, chair of the OSC, remarked that the Program has “proven to be a game-changer” for the OSC’s enforcement efforts.[4] Given the ongoing “active investigations”, we expect to see more announcements of awards paid to whistleblowers very soon. The pressure is on the OSC to bolster the profile and credibility of the Program.
Comparison with Other Whistleblower Programs
For some perspective, a comparison with the performance of the Dodd-Frank Whistleblower Program launched by the U.S. Securities and Exchange Commission (the “SEC”) in 2010 (the “SEC Program”) is useful, while keeping in mind the significantly larger size of the capital markets the SEC regulates.
The number of tips received by the SEC on a yearly basis reflects a consistently upward trajectory – from a total of 3,001 tips received in 2011 (the first year the SEC had data for a full year) to 5,282 tips received in 2018.[5] Given the number of tips received, it is somewhat surprising that in 2018, the SEC ordered whistleblower awards to only approximately 13 individuals[6], and since the inception of the SEC Program, the SEC ordered whistleblower awards to 59 individuals. Based on our review of the 2018 SEC Program report, our calculations show that the SEC has received a total of 28,100 tips since the program’s inception. If we assume that each of the individuals who received an award submitted one tip, this translates into a 0.2% chance that an individual tip will result in a whistleblower award – a potentially bleak outcome for whistleblowers contemplating whether or not to report.
We expect to see a similar upward trajectory in the number of tips received by the Program as it gains credibility within the capital markets. The trend with the SEC Program shows that an increase in the number of tips received does not necessarily translate into an increase in the number of whistleblower awards paid out. However, it is still too early to predict how many of the tips received by the Program may result in successful enforcement proceedings.
In-House Counsel Are Precluded from Receiving a Whistleblower Award
A further interesting update on the Program is the OSC’s issuance of a Notice of Policy Amendment to the Program (the “Amendment”) in early October 2018. The Amendment altered the eligibility requirements for a whistleblower award by precluding in-house counsel who report information in breach of applicable law society rules from receiving a whistleblower award.[7]
The definition of “original information” in OSC Policy 15-601 Whistleblower Program excludes information that a whistleblower has obtained through a communication subject to solicitor-client privilege, and subsection 14(3) provides that no award will be issued for privileged information.[8] The exceptions enumerated in subsection 15(2) that permit payments of awards for otherwise ineligible classes of individuals do not apply to in-house counsel in respect of matters that arise while acting in a legal capacity. Previously, the application of these exceptions to in-house counsel was in contemplation of situations where an employee has both legal and non-legal functions within an organization and “blows the whistle” on a matter that arises while the lawyer is acting outside of his or her legal capacity.[9] The purpose for the Amendment was to clarify that its intention was not to incentivize professional misconduct on the part of in-house lawyers.
Due to this amendment, in-house counsel must now consider when, how, and in what capacity they acquired the subject information.[10] This raises a number of potentially difficult considerations for lawyers in those roles. The Amendment serves as a reminder to in-house counsel that their duty to preserve the confidentiality of their clients trumps the potential value of the information in their possession.
Most recently, Ontario’s budget plan for 2019 noted that the provincial government intends to propose changes to capital markets legislation that will include clarifying the awards payment under the Program as part of its plan to modernize the legislation.[11] To date, no further details to the proposed changes have been announced.
Concluding Remarks
A measure of the Program’s success is whether its principal objective, which is to deter corporate misconduct, has been fulfilled. At this time, the Program is still in its infancy and award payments cannot be made until all appeal rights have been exhausted or expired. One challenge in evaluating the success of the Program is that, if deterrence is the end goal, then a reduction in the number of tips received may be a blessing or a curse. In other words, a decreasing number of tips may either be an indication of the Program’s deterrent effect (i.e. less corporate misconduct) or a sign of the Program’s failure (i.e. reduced trust in the Program by the public).
What is evident, however, is that whether or not the Program will accomplish its aim of deterring improper conduct on the part of individuals and corporations ultimately depends on prospective whistleblowers’ cost-benefit analyses of the value of “blowing the whistle” versus the potential financial and reputational risks in the event that their anonymity is compromised. We look forward to the OSC publishing a further update on the performance of the Program.
[1] News Release, “OSC Whistleblower Program Contributing to a Stronger Culture of Compliance,” June 29, 2018, https://www.osc.gov.on.ca/en/NewsEvents_nr_20180629_osc-whistleblower-program-contributing-to-a-stronger-culture-of-compliance.htm.
[2] Ontario Securities Commission “Branches & Offices,” https://www.osc.gov.on.ca/en/About_branches-offices_index.htm.
[3] News Release, “OSC Awards $7.5 Million to Three Whistleblowers,” February 27, 2019, https://www.osc.gov.on.ca/en/NewsEvents_nr_20190227_osc-awards-to-three-whistleblowers.htm.
[4] News Release, “OSC Awards $7.5 Million to Three Whistleblowers,” February 27, 2019, https://www.osc.gov.on.ca/en/NewsEvents_nr_20190227_osc-awards-to-three-whistleblowers.htm.
[5] U.S. Securities and Exchange Commission, “2018 Annual Report to Congress: Whistleblower Program”: https://www.sec.gov/files/sec-2018-annual-report-whistleblower-program.pdf.
[6] In 2017, the SEC ordered whistleblower awards to only approximately 12 individuals.
[7] Notice of Policy Amendment to OSC Policy 15-601 Whistleblower Program, October 4, 2018, https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20181004_15-601_whistleblower-program.htm.
[8] OSC Policy 15-601 Whistleblower Program, https://www.osc.gov.on.ca/documents/en/Securities-Category1/20160714_15-601_policy-whistleblower-program.pdf.
[9] Notice of Policy Amendment to OSC Policy 15-601 Whistleblower Program, October 4, 2018, https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20181004_15-601_whistleblower-program.htm.
[10] OSC Notice and Request for Comment: Proposed Change to OSC Policy 15-601 Whistleblower Program, https://www.osc.gov.on.ca/en/SecuritiesLaw_rule_20180118_15-601_rfc-whistleblower-program.htm.
[11] 2019 Ontario Budget: Protecting What Matters Most, http://budget.ontario.ca/pdf/2019/2019-ontario-budget-en.pdf.
“You’re Fired!”: Calculating Employment Damages for a Loss of Incentive Based Compensation
What Can SEC Sweeps of Off-Channel Communications Teach Canadian Securities Markets Participants? Stop Texting (for Work)
Court of Appeal for Ontario: No “Option” for Management to Act Oppressively
On June 29, 2018, the OSC released its first (and only) update on the progress of the Program. [1] It disclosed that the Program had generated approximately 200 tips since its inception and that approximately 7% of those tips resulted in “active investigations” by the OSC’s Enforcement Branch, the branch responsible for investigating and litigating breaches of the Securities Act.[2]
In addition to promoting creativity and imaginative play, nagic magnetic tiles also have educational benefits. By playing with these tiles, children learn about basic geometry, symmetry, and patterns. They can experiment with different shapes and sizes, discovering how they fit together and create stable structures. Moreover, these tiles can be an excellent tool for introducing scientific concepts to children. They can learn about magnetism, as they observe how the magnets attract and repel each other. They can also explore concepts such as balance and stability, as they experiment with building taller and more complex structures. Nagic magnetic tiles are not only enjoyed by children but also by adults. They serve as a stress-relieving, creative outlet for individuals of all ages. The endless possibilities for building and creating with these tiles make them a versatile and engaging toy for everyone. In conclusion, nagic magnetic tiles are a wonderful educational toy that combines creativity, problem-solving, and scientific concepts. They offer children of all ages an opportunity to develop their fine motor skills, spatial reasoning, and critical thinking abilities. Furthermore, these tiles provide a platform for imaginative play and the exploration of scientific concepts. Whether you are a child or an adult, nagic magnetic tiles are sure to provide hours of fun and learning..
Reviews for "Exploring Magnetism with Nagic Magnetic Tiles"
1. Helen - 2 stars - I was really disappointed with the Nagic magnetic tiles. They were not as strong as I expected and kept falling apart when my kids tried to build with them. The magnets were not secure enough and would easily detach from the tiles. Additionally, the tiles were not very durable and broke easily with just a slight drop. Overall, I think these tiles are overpriced for the poor quality they offer.
2. Mark - 1 star - I regret buying the Nagic magnetic tiles. They were marketed as a great educational toy, but they failed to deliver. The magnets were too weak to hold the tiles together properly, so my kids got frustrated trying to build anything. Also, the tiles were poorly designed, with sharp corners that easily hurt my children when they accidentally bumped into them. I would not recommend these tiles to anyone looking for a reliable and safe magnetic building set.
3. Lisa - 2 stars - I bought the Nagic magnetic tiles for my son's birthday, and it turned out to be a waste of money. The tiles did not stick together well due to the weak magnets, and they could not hold up even the simplest structures. My son quickly lost interest in playing with them because of the constant frustration. Additionally, the colors of the tiles started fading after just a few uses, making them look old and worn-out. I expected better quality for the price I paid.
4. Ryan - 2 stars - I was excited to try out the Nagic magnetic tiles, but unfortunately, they did not live up to my expectations. The magnets were not strong enough, and the tiles would often detach easily, causing the structures to collapse. This made it frustrating for my kids to play with them. The set also came with a limited number of tiles, which limited the creativity and possibilities for building. I would recommend looking for alternative magnetic tiles that offer better quality and value.