Ontario Securities Commission report on dark patterns in retail investing

The Ontario Securities Commission (OSC) report delves into the use of dark patterns and other digital engagement practices in investing platforms. The findings indicate that these patterns, which can disguise investing costs, obtain personal information without informed consent, and make it difficult for investors to withdraw funds or close accounts, are prevalent and potentially harmful to investor welfare. The report also addresses other digital engagement practices such as dark nudges, sludge, and targeted advertising. It notes the risks these practices pose, including the difficulty in cancelling subscriptions, the use of complex language within fee schedules, and the removal of process steps in trade execution. The OSC urges for more research in this area and for firms to consider the negative impact of these practices on clients' decision-making.