Pick up a copy of Canadian Business Magazine for aug 13/27 on the shelf now. Visit the editorial on page 80, "Calling all Fraudsters".
It quotes some 1236 convictions for corporate fraud in the USA over a recent period of time, and compares this to only 2 (two) similar convictions in Canada during the same period.
It causes me to go one step further and write the following:
“ SUICIDES MORE PREVALENT THAN
PROSECUTIONS FOR FINANCIAL FRAUD IN
CANADA”
Research for the documentary film, BREACH OF TRUST, The Unique Violence of White Collar Crime, is learning that a victim of white collar financial abuse or a truth telling employee of a financial firm is more likely to be punished under Canada’s unique system of regulation, than a financial fraudster in Canada.
These punishments lead to an endless array of societal problems, such as domestic violence, depression, aggression, unemployment, addiction, mental and physical problems, homelessness etc., etc. Every one of those affected, have a negative impact on ten other lives, putting the damage to humans on tens, if not hundreds of thousands of Canadians. At the very end of the scale are those one in a thousand persons who let go of the hope of living, and take their own lives.
Breach of Trust tries to illustrate how Canadians are being “gouged, skimmed, or abused”, by the very industry of financial professionals who are purporting to serve them. It finds a minimum of $30 billion per year in abusive overcharging of a trusting, vulnerable, and captive Canadian public each year.
Larry Elford (former CFP, CIM, FCSI, Associate Portfolio Manager, retired 2004)
Independent producer of BREACH OF TRUST, and founder of investoradvocates.ca
Lethbridge, Alberta
film site www.breachoftrust.ca
financial forum www.investoradvocates.ca
fraud and regulatory abuse research site www.investorvoice.ca
Canadian Business Mag editorial “Calling all Fraudsters”, page 80, Aug 13/27, 2007
Misconduct and malpractice. Investment industry "best and worst practices". Information to improve public protection. Expert witness services for industry and investors. Forensic investment analysis.
http://www.lulu.com/shop/http://www.lulu.com/shop/larry-elford/about-your-financial-murder/paperback/product-23564385.html
Fraudsters in the US get caught. In Canada they get rich.
49 posts
• Page 3 of 4 • 1, 2, 3, 4
by admin » Wed Aug 15, 2007 10:17 pm
“Look what happened about late trading. A few corporations paid fines, but they
stole money from members of the [mutual] funds. It became difficult to know who
personally did it; the names were buried. And the fines were small. In the U.S. there
were huge fines, people are still being prosecuted over it. They will go to jail. Here
nobody was prosecuted ” – Claude Lamoureux, CEO Ontario Teachers Pension Plan
Source: D. Francis, Canada’s securities law is too lax, National Post, Aug. 12, 2006 pg
FP2
stole money from members of the [mutual] funds. It became difficult to know who
personally did it; the names were buried. And the fines were small. In the U.S. there
were huge fines, people are still being prosecuted over it. They will go to jail. Here
nobody was prosecuted ” – Claude Lamoureux, CEO Ontario Teachers Pension Plan
Source: D. Francis, Canada’s securities law is too lax, National Post, Aug. 12, 2006 pg
FP2
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Fri Aug 03, 2007 11:00 pm
To: letters@macleans.ca
Subject: It doesn'talways pay to be tough Colin Campbelll Aug. 13, 2007
page 48
LETTER TO THE EDITOR
I was shocked to read this article. Canadian investors are truly laid bare
as John Reynold's insightful book " the Naked Investor" so eloquently
explains. Rogue brokers rarely get punished and wrist slap penalties are
imposed on errant firms. Frauds like Bre-X go unpunished.YBM Magnex cost
investors hundreds of millions of dollars. Regulators rarely take investors
concerns into account. The 2005 Ontario Securities Commission investor Town
Hall meeting demonstrated just how abused Canadian investors are. Regulators
appeared stunned at the outpouring of grief and financial ruin.
With useless financial products, abusive sales practices, the highest mutual
fund fees in the world and infamous income trust scan, Canadians could well
be facing billions of dollars an undue losses each year. Canada's soft
approach to regulatory enforcement is nothing less than a financial assault
on middle-class.
Our investor protection isn't just soft -it's non-existant.Regulators and
judges are in their own world ,blind to the impact of their malpractices.
Ken Kivenko,
President Kenmar consulting
see www.canadianfundwatch.com
Subject: It doesn'talways pay to be tough Colin Campbelll Aug. 13, 2007
page 48
LETTER TO THE EDITOR
I was shocked to read this article. Canadian investors are truly laid bare
as John Reynold's insightful book " the Naked Investor" so eloquently
explains. Rogue brokers rarely get punished and wrist slap penalties are
imposed on errant firms. Frauds like Bre-X go unpunished.YBM Magnex cost
investors hundreds of millions of dollars. Regulators rarely take investors
concerns into account. The 2005 Ontario Securities Commission investor Town
Hall meeting demonstrated just how abused Canadian investors are. Regulators
appeared stunned at the outpouring of grief and financial ruin.
With useless financial products, abusive sales practices, the highest mutual
fund fees in the world and infamous income trust scan, Canadians could well
be facing billions of dollars an undue losses each year. Canada's soft
approach to regulatory enforcement is nothing less than a financial assault
on middle-class.
Our investor protection isn't just soft -it's non-existant.Regulators and
judges are in their own world ,blind to the impact of their malpractices.
Ken Kivenko,
President Kenmar consulting
see www.canadianfundwatch.com
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Fri Aug 03, 2007 9:35 pm
If you didn't believe it before, believe it now. It really is Investor Beware!.
Felderhof, Bre-X chief geologist, found not guilty on all charges.
The scam of the century. Salted core samples. Outright fraud.
It seems ridiculous that the chief geologist would not be aware that the gold wasn't there. How could he support the outlandish claims of resources? Was it alluvial gold (from a riverbed) that was used to salt these core samples? A layman might not know the difference, but a seasoned geologist? It boggles the mind.
As an officer (vice chairman) of the company wouldn't he want to be sure of this incredible gold find? Did he fulfill his responsibilities as chief geologist and company officer?
In any case he was an officer of the company that perpetrated the fraud labelled the scam of the century.
Whether he instigated it or not, he participated as chief geologist and a company officer. It makes no sense that he is allowed to escape with the loot ... some $90 million. How many small investors have lost their savings on Bre-X? How many widows and seniors have lost all of their savings? How many are still suffering?
How can Government allow this to happen?
It's time to revamp the regulatory system and the justice system.
If anything positive came out of this regulatory fiasco it is this:
1. The public now knows with certainty that the Canadian Regulatory System is failing investors and does not provide investor protection either preventative or remedial.
2. The public now knows with certainty that the Canadian Justice System does not provide justice.
Unfortunately it also sends a message to the rest of the world that Canada really is the Wild West of investing without frontier justice, so foreign investors would be wise to stay away.
At the same time it sends a message to prospective fraudsters that Canada is the place to be if your intent is to defraud the public.
Will this precipitate Government action? It should.
What can we do?
Write your Member of Provincial Parliament and your Member of Parliament in Ottawa.
Do it for your children and their children. Don't let it happen to them.
Stan Buell, President
Small Investor Protection Association
P.O.Box 325, Markham, ON, L3P 3J8
website: www.sipa.ca
e-mail: sipa@sipa.ca
tel: 905-471-2911
Fighting for Justice
Felderhof, Bre-X chief geologist, found not guilty on all charges.
The scam of the century. Salted core samples. Outright fraud.
It seems ridiculous that the chief geologist would not be aware that the gold wasn't there. How could he support the outlandish claims of resources? Was it alluvial gold (from a riverbed) that was used to salt these core samples? A layman might not know the difference, but a seasoned geologist? It boggles the mind.
As an officer (vice chairman) of the company wouldn't he want to be sure of this incredible gold find? Did he fulfill his responsibilities as chief geologist and company officer?
In any case he was an officer of the company that perpetrated the fraud labelled the scam of the century.
Whether he instigated it or not, he participated as chief geologist and a company officer. It makes no sense that he is allowed to escape with the loot ... some $90 million. How many small investors have lost their savings on Bre-X? How many widows and seniors have lost all of their savings? How many are still suffering?
How can Government allow this to happen?
It's time to revamp the regulatory system and the justice system.
If anything positive came out of this regulatory fiasco it is this:
1. The public now knows with certainty that the Canadian Regulatory System is failing investors and does not provide investor protection either preventative or remedial.
2. The public now knows with certainty that the Canadian Justice System does not provide justice.
Unfortunately it also sends a message to the rest of the world that Canada really is the Wild West of investing without frontier justice, so foreign investors would be wise to stay away.
At the same time it sends a message to prospective fraudsters that Canada is the place to be if your intent is to defraud the public.
Will this precipitate Government action? It should.
What can we do?
Write your Member of Provincial Parliament and your Member of Parliament in Ottawa.
Do it for your children and their children. Don't let it happen to them.
Stan Buell, President
Small Investor Protection Association
P.O.Box 325, Markham, ON, L3P 3J8
website: www.sipa.ca
e-mail: sipa@sipa.ca
tel: 905-471-2911
Fighting for Justice
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Thu Aug 02, 2007 9:42 pm
Inability to catch scammers an 'embarrassment:' Flaherty
Canadian Press
August 2, 2007 at 7:04 PM EDT
OTTAWA — Canada's inability to catch and convict white-collar criminals who cheat and steal from ordinary investors is an “embarrassment” internationally that must be addressed, says Finance Minister Jim Flaherty.
Speaking for the first time on the subject since this week's acquittal in the Bre-X gold swindle case and recent conviction of Conrad Black in a U.S. courtroom, the minister said Canada must establish a national regulator to protect investors from scam artists.
In a telephone interview from Coolum, Australia, where he was attending a meeting of Asia-Pacific Economic Co-operation finance ministers, Mr. Flaherty said he could not comment specifically on the Bre-X Minerals and Black fraud cases, but made clear that he was frustrated with Canada's poor record in detecting, investigating and prosecuting securities breaches.
“I think enforcement with respect to securities is an embarrassment internationally to Canada,” he said.
“ We need to better protect investors against breaches of securities law and we need to do that in our own country and not rely on other countries to do it for us.”
Mr. Flaherty urged his provincial counterparts to establish a national securities regulator at a meeting near Ottawa in June, but although he said consensus is building on the issue, some provinces remain skeptical.
Ontario, where about 85 per cent of stock trading is done, is the only province that has publicly endorsed the creation of a national regulator, whereas Quebec and Alberta are regarded the most hostile, fearing a loss of influence.
Currently every province and territory has its own regulator with enforcement powers, but experts have regarded them as ineffective.
The problem, says Mr. Flaherty, is that with 13 jurisdictions operating independently, often using different police forces to conduct investigations, there is little co-ordination and sharing of information.
The other problem, he acknowledged, is the perception that the issue does not touch ordinary Canadians, hence lacks political urgency.
“Sometimes people look at the issue of a common securities regulator as an issue of Bay Street, but the issue relates to every Canadian who has an interest in a pension fund, every Canadian who has any stocks, every Canadian who has an RRSP.”
Last month, Ontario Teachers Pension Plan chief executive officer Claude Lamoureux said Canada's laws need to be changed to make it easier to prosecute securities offences.
“Our laws need to be changed to make it easier. Somehow we don't think this is important. Everyone's blaming the other guy and in the end nothing gets done,” he explained.
But Mr. Flaherty said more important than amending laws is to find a way to be more effective in enforcing the laws that are already on the books.
“We can write all the laws we want, but if we don't have a co-ordinated competent enforcement arm, then those who will want to mislead investors, breach securities laws, basically steal from investors in Canada, laugh at our inability to enforce our securities laws,” he said.
Canada's has historically had a poor record in identifying and prosecuting white-collar crimes, especially when compared to the U.S., where recent high-profile prosecutions have include Martha Stewart, Enron officials, and pointedly, Canadian-born former newspaper baron Conrad Black.
In one of the few high-profile cases that have gone to court in Canada, former Bre-X vice-chairman John Felderhof was acquitted on eight counts Tuesday in the biggest stock market swindle in Canadian history, which duped investors of an estimated $6-billion after it turned out that the so-called world's largest gold find was actually an elaborate hoax to drive up the company's stock.
No one has even been convicted in relation with the scandal, and no one has ever been charged with perpetrating the hoax. Mr. Felderhof was charged with insider trading, issuing false press releases and in relation to his sale of $84-million worth of Bre-X shares, a process that took an extraordinary seven years to complete.
Canada has poured $120-million into an RCMP securities enforcement project with nine teams across the country. But the teams have laid few charges and recently the government appointed Nicholas LePan, a former superintendent of Financial Institutions, to make recommendations on how to make them more effective.
Canadian Press
August 2, 2007 at 7:04 PM EDT
OTTAWA — Canada's inability to catch and convict white-collar criminals who cheat and steal from ordinary investors is an “embarrassment” internationally that must be addressed, says Finance Minister Jim Flaherty.
Speaking for the first time on the subject since this week's acquittal in the Bre-X gold swindle case and recent conviction of Conrad Black in a U.S. courtroom, the minister said Canada must establish a national regulator to protect investors from scam artists.
In a telephone interview from Coolum, Australia, where he was attending a meeting of Asia-Pacific Economic Co-operation finance ministers, Mr. Flaherty said he could not comment specifically on the Bre-X Minerals and Black fraud cases, but made clear that he was frustrated with Canada's poor record in detecting, investigating and prosecuting securities breaches.
“I think enforcement with respect to securities is an embarrassment internationally to Canada,” he said.
“ We need to better protect investors against breaches of securities law and we need to do that in our own country and not rely on other countries to do it for us.”
Mr. Flaherty urged his provincial counterparts to establish a national securities regulator at a meeting near Ottawa in June, but although he said consensus is building on the issue, some provinces remain skeptical.
Ontario, where about 85 per cent of stock trading is done, is the only province that has publicly endorsed the creation of a national regulator, whereas Quebec and Alberta are regarded the most hostile, fearing a loss of influence.
Currently every province and territory has its own regulator with enforcement powers, but experts have regarded them as ineffective.
The problem, says Mr. Flaherty, is that with 13 jurisdictions operating independently, often using different police forces to conduct investigations, there is little co-ordination and sharing of information.
The other problem, he acknowledged, is the perception that the issue does not touch ordinary Canadians, hence lacks political urgency.
“Sometimes people look at the issue of a common securities regulator as an issue of Bay Street, but the issue relates to every Canadian who has an interest in a pension fund, every Canadian who has any stocks, every Canadian who has an RRSP.”
Last month, Ontario Teachers Pension Plan chief executive officer Claude Lamoureux said Canada's laws need to be changed to make it easier to prosecute securities offences.
“Our laws need to be changed to make it easier. Somehow we don't think this is important. Everyone's blaming the other guy and in the end nothing gets done,” he explained.
But Mr. Flaherty said more important than amending laws is to find a way to be more effective in enforcing the laws that are already on the books.
“We can write all the laws we want, but if we don't have a co-ordinated competent enforcement arm, then those who will want to mislead investors, breach securities laws, basically steal from investors in Canada, laugh at our inability to enforce our securities laws,” he said.
Canada's has historically had a poor record in identifying and prosecuting white-collar crimes, especially when compared to the U.S., where recent high-profile prosecutions have include Martha Stewart, Enron officials, and pointedly, Canadian-born former newspaper baron Conrad Black.
In one of the few high-profile cases that have gone to court in Canada, former Bre-X vice-chairman John Felderhof was acquitted on eight counts Tuesday in the biggest stock market swindle in Canadian history, which duped investors of an estimated $6-billion after it turned out that the so-called world's largest gold find was actually an elaborate hoax to drive up the company's stock.
No one has even been convicted in relation with the scandal, and no one has ever been charged with perpetrating the hoax. Mr. Felderhof was charged with insider trading, issuing false press releases and in relation to his sale of $84-million worth of Bre-X shares, a process that took an extraordinary seven years to complete.
Canada has poured $120-million into an RCMP securities enforcement project with nine teams across the country. But the teams have laid few charges and recently the government appointed Nicholas LePan, a former superintendent of Financial Institutions, to make recommendations on how to make them more effective.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Wed Aug 01, 2007 4:43 pm
Felderhof acquitted on Bre-X securities charges
Former chief geologist and vice chairman not guilty
Tuesday, July 31, 2007
By IE Staff
Advertisement
John Felderhof has been acquitted of all insider trading and other securities charges he faced regarding the Bre-X Minerals gold scandal.
The verdicts were released in the Ontario Superior Court today.
“These were serious charges and it was appropriate to bring them before the court. We will review the decision and consider our next steps,” said OSC Chairman David Wilson, in a release. “The OSC considers each case on its merits and determines the best course of action. This result will in no way deter us from continuing to investigate and prosecute alleged breaches of our Act.”
Felderhof was the company’s former vice-chairman and chief geologist. The Ontario Securities Commission accused him of eight Securities Act violations -- four counts of illegal insider trading and four counts of sending out misleading news releases.
Felderhof sold $84 million worth of Bre-X stock in 1996, just before the company’s supposedly rich gold project in Busang, Indonesia, was exposed as a fraud.
The OSC has alleged that Felderhof illegally acted on insider information when he sold the shares. The OSC has also accused him of putting his name to news releases the regulator said he should have known were misleading. He has denied all the allegations, saying he was taken in like everyone else.
The Calgary-based company was a stock market darling from 1995 to 1997.
Bre-X claimed it had discovered huge amounts of gold in the Busang area of Indonesia. The company’s shares soared from penny stock status to more than $200 a share.
But by the spring of 1997, everything began to unravel. New tests carried out by another company showed there was virtually no gold in the Bre-X deposit. The original positive assay results had been sprinkled with gold from other sources.
Bre-X stock tanked, costing thousands of investors in the once high-flying company as much as $6 billion.
Despite demands for someone to be brought to justice for the fraud, no one was to ever face criminal charges.
One day after the OSC brought its Securities Act charges against Felderhof, the RCMP said it would be impossible to gather enough evidence to lay criminal charges against anyone.
Bre-X geologist Michael de Guzman had died mysteriously in March 1997, after apparently committing suicide by jumping from a helicopter into the Indonesian jungle.
Bre-X president David Walsh died in 1998 after suffering a brain aneurysm at his home in the Bahamas.
Former chief geologist and vice chairman not guilty
Tuesday, July 31, 2007
By IE Staff
Advertisement
John Felderhof has been acquitted of all insider trading and other securities charges he faced regarding the Bre-X Minerals gold scandal.
The verdicts were released in the Ontario Superior Court today.
“These were serious charges and it was appropriate to bring them before the court. We will review the decision and consider our next steps,” said OSC Chairman David Wilson, in a release. “The OSC considers each case on its merits and determines the best course of action. This result will in no way deter us from continuing to investigate and prosecute alleged breaches of our Act.”
Felderhof was the company’s former vice-chairman and chief geologist. The Ontario Securities Commission accused him of eight Securities Act violations -- four counts of illegal insider trading and four counts of sending out misleading news releases.
Felderhof sold $84 million worth of Bre-X stock in 1996, just before the company’s supposedly rich gold project in Busang, Indonesia, was exposed as a fraud.
The OSC has alleged that Felderhof illegally acted on insider information when he sold the shares. The OSC has also accused him of putting his name to news releases the regulator said he should have known were misleading. He has denied all the allegations, saying he was taken in like everyone else.
The Calgary-based company was a stock market darling from 1995 to 1997.
Bre-X claimed it had discovered huge amounts of gold in the Busang area of Indonesia. The company’s shares soared from penny stock status to more than $200 a share.
But by the spring of 1997, everything began to unravel. New tests carried out by another company showed there was virtually no gold in the Bre-X deposit. The original positive assay results had been sprinkled with gold from other sources.
Bre-X stock tanked, costing thousands of investors in the once high-flying company as much as $6 billion.
Despite demands for someone to be brought to justice for the fraud, no one was to ever face criminal charges.
One day after the OSC brought its Securities Act charges against Felderhof, the RCMP said it would be impossible to gather enough evidence to lay criminal charges against anyone.
Bre-X geologist Michael de Guzman had died mysteriously in March 1997, after apparently committing suicide by jumping from a helicopter into the Indonesian jungle.
Bre-X president David Walsh died in 1998 after suffering a brain aneurysm at his home in the Bahamas.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Mon Jul 30, 2007 11:50 pm
Subject: ASC Chairman Bill Rice and Other Securities Regulators & Experts
Ignore Today's Canadian Press-Decima Poll
Add Alberta Securities Commission Chairman Bill Rice to the list of Canada's securities regulators and legal experts trying to convince us there are few high profile white collar crimes in Canada and that Canadians are less aggressive in the pursuit of law and order than Americans. Bill Rice, David Brown (former OSC Chairman and Current Chairman of the RCMP Restructuring Task Force) , David Wilson (current OSC Chairman) and Purdy Crawford (Bay Street securities lawyer and recognized architect of Canada's current securities enforcement system) are out of sync with the knowledge and standards set by Canadian society, as they are expressed in today's Toronto Star - Canadian Press report on the Canadian Press - Decima poll of Canadian attitudes towards the U.S. Conrad Black verdict and his expected jail sentencing.
"The survey of more than 1,000 Canadians found that only 8 per cent think the American jury was too severe in convicting Black on four of 11 charges earlier this month. Forty-eight per cent say the jury got it about right and 22 per cent said the verdict was not severe enough.
"Decima found that most respondents 69 per cent would like Black to see jail time in addition to paying a fine. Just 10 per cent believed a fine is ample punishment. Some 29 per cent felt he should be sentenced to 10 years or more in prison, with another 40 per cent feeling that one to nine years would suffice."
Meanwhile, this is what Bill Rice, David Brown, David Wilson and Purdy Crawford have had to say about white collar crime in Canada:
"There's always room to improve, admits Alberta Securities Commission chairman Bill Rice. That includes changing the perception that Canada doesn't aggressively pursue rogue executives. Rice, a former securities lawyer, feels Canada too often is an easy target. Without a trial to match the visibility of Enron or WorldCom, regulators here come up short by comparison. The reality, he says, is that aggressive, U.S-style punitive action isn't the Canadian way when it comes to stock market scandals. "There is an extreme cultural difference in our approach to criminal law enforcement. We certainly don't send people away for 25 years for these kinds of things. "I happen to think our public would be horrified by it."
(Calgary Herald, "Business Scandals dog Canadian markets," dated May 28, 2007)
"David Brown, past chair of the OSC, said, "Canada's come a long way ... I think all of the pieces are in place now. We all need to give it a little more time." And he added that the lack of high-profile convictions in Canada could have something to do with a lack of high-profile crimes. "We don't seem to have seen here in Canada the high-profile failures that they have in the U.S.," he said." (Toronto Star, "Soft on White Collar Crime," May 29, 2006)
"But a small minority of firms and individuals prey on investors. Unfortunately, this small group has a disproportionate impact on the perception of Canadas capital markets. I understand the challenge of trying to close a gap between perception and reality." (OSC Chairman David Wilson Speech, "A Common Objective: Strong Investor Protection," April 26, 2007)
"Purdy Crawford, a lawyer who headed a commission that urged the creation of a single national securities regulator, said he was disappointed Canada didn't take the initiative to prosecute Black before he went to trial in the United States. "The best thing that ever could have happened to him would have been to have been prosecuted here," said Crawford, although he added the U.S. authorities' "no holds barred" approaches are also overzealous to a fault."
(Canadian Business Online,"Securities Enforcement Still Lacks Teeth Experts Say," July 17, 2007)
Canadians are well aware that economic crime is a serious problem in Canada, so the efforts of Bill Rice, David Brown, David Wilson and Purdy Crawford to coverup this fact are falling on deaf ears. The longstanding efforts of these men to coverup white collar crime and to mitigate Canada's prosecutorial response to it can only be interpreted to be a breach of trust to the Canadian people.
In a recent survey (EKOS Survey, Wave 3, 2005-2006), Canadians said economic crime was the most serious problem in Canada at 67%, gang violence rated second at 66%, and gun crime and organized crime both rated third at 54%. Terrorism rated last at 14%. When asked about what type of crimes Canadians were personally more concerned about, those polled rated economic crime first at 68%, gang violence second at 59%, gun crime third at 51%, property crime forth at 48%. Terrorism rated last at 30%.
(RCMP Integrated Market Enforcement Teams Accountability Framework - Fiscal Year Ending March 31, 2006)
On April 26, 2007, the National Pensioners & Senior Citizens Federation (450 clubs and chapters with 1,000,000 members), the United Senior Citizens of Ontario (1000 clubs with 300,000 members) and the Small Investors Protection Association jointly requested a national inquiry on the malfunctioning of Canada's securities and accounting regulation and white collar crime enforcement system.
Diane Urquhart
Independent Analyst
Tel: (905) 822-7618
Cell: (416) 505-4832
Canadians say send Black to jail
69% of those surveyed believe convicted tycoon should serve time
July 30, 2007
Canadian Press
OTTAWAAuthor, biographer, British lord, business tycoon, media mogul and convicted criminal. And now, suggests a new Canadian Press-Decima poll, you can add soothsayer to Conrad Black's list of titles.
"The destructive fixation of the envious English-Canadian mind requires that the highest, happiest, most agile flyers be laid low," Black wrote in his 1993 memoir, Conrad Black: A Life In Progress.
He called it "a sadistic desire corroded by soul-destroying envy, to intimidate all those who might aspire to anything the slightest exceptional."
Judging by public reaction to Black's recent conviction by a Chicago jury, the multi-millionaire businessman got that right.
The survey of more than 1,000 Canadians found that only 8 per cent think the American jury was too severe in convicting Black on four of 11 charges earlier this month. Forty-eight per cent say the jury got it about right and 22 per cent said the verdict was not severe enough.
Black, convicted on counts of mail fraud and obstruction of justice, won't be sentenced until November but he should take some small solace that Canadian public opinion won't influence his penalty.
Decima found that most respondents 69 per cent would like Black to see jail time in addition to paying a fine. Just 10 per cent believed a fine is ample punishment.
Some 29 per cent felt he should be sentenced to 10 years or more in prison, with another 40 per cent feeling that one to nine years would suffice. Black, who gave up his Canadian citizenship in 2001 to accept a British peerage, is appealing the conviction.
Among the four in 10 respondents who said they followed his criminal trial closely, opinions against Black were no better and in some cases, more harsh. Some 60 per cent of respondents rising to 71 per cent among close followers of the trial said the Montreal-born Black's Canadian citizenship should not be reinstated.
Bruce Anderson, Decima's CEO, said the poll is a clear signal that "most of those Canadians who passed judgment on Conrad Black, came to similar conclusions as the jury did.
"Most show little sympathy for Mr. Black, and see no reason why he should have his citizenship restored, or maintain his Order of Canada designation."
The poll, conducted July 19-22, has a margin of error of plus or minus 3.1 percentage points, 19 times in 20.
Ignore Today's Canadian Press-Decima Poll
Add Alberta Securities Commission Chairman Bill Rice to the list of Canada's securities regulators and legal experts trying to convince us there are few high profile white collar crimes in Canada and that Canadians are less aggressive in the pursuit of law and order than Americans. Bill Rice, David Brown (former OSC Chairman and Current Chairman of the RCMP Restructuring Task Force) , David Wilson (current OSC Chairman) and Purdy Crawford (Bay Street securities lawyer and recognized architect of Canada's current securities enforcement system) are out of sync with the knowledge and standards set by Canadian society, as they are expressed in today's Toronto Star - Canadian Press report on the Canadian Press - Decima poll of Canadian attitudes towards the U.S. Conrad Black verdict and his expected jail sentencing.
"The survey of more than 1,000 Canadians found that only 8 per cent think the American jury was too severe in convicting Black on four of 11 charges earlier this month. Forty-eight per cent say the jury got it about right and 22 per cent said the verdict was not severe enough.
"Decima found that most respondents 69 per cent would like Black to see jail time in addition to paying a fine. Just 10 per cent believed a fine is ample punishment. Some 29 per cent felt he should be sentenced to 10 years or more in prison, with another 40 per cent feeling that one to nine years would suffice."
Meanwhile, this is what Bill Rice, David Brown, David Wilson and Purdy Crawford have had to say about white collar crime in Canada:
"There's always room to improve, admits Alberta Securities Commission chairman Bill Rice. That includes changing the perception that Canada doesn't aggressively pursue rogue executives. Rice, a former securities lawyer, feels Canada too often is an easy target. Without a trial to match the visibility of Enron or WorldCom, regulators here come up short by comparison. The reality, he says, is that aggressive, U.S-style punitive action isn't the Canadian way when it comes to stock market scandals. "There is an extreme cultural difference in our approach to criminal law enforcement. We certainly don't send people away for 25 years for these kinds of things. "I happen to think our public would be horrified by it."
(Calgary Herald, "Business Scandals dog Canadian markets," dated May 28, 2007)
"David Brown, past chair of the OSC, said, "Canada's come a long way ... I think all of the pieces are in place now. We all need to give it a little more time." And he added that the lack of high-profile convictions in Canada could have something to do with a lack of high-profile crimes. "We don't seem to have seen here in Canada the high-profile failures that they have in the U.S.," he said." (Toronto Star, "Soft on White Collar Crime," May 29, 2006)
"But a small minority of firms and individuals prey on investors. Unfortunately, this small group has a disproportionate impact on the perception of Canadas capital markets. I understand the challenge of trying to close a gap between perception and reality." (OSC Chairman David Wilson Speech, "A Common Objective: Strong Investor Protection," April 26, 2007)
"Purdy Crawford, a lawyer who headed a commission that urged the creation of a single national securities regulator, said he was disappointed Canada didn't take the initiative to prosecute Black before he went to trial in the United States. "The best thing that ever could have happened to him would have been to have been prosecuted here," said Crawford, although he added the U.S. authorities' "no holds barred" approaches are also overzealous to a fault."
(Canadian Business Online,"Securities Enforcement Still Lacks Teeth Experts Say," July 17, 2007)
Canadians are well aware that economic crime is a serious problem in Canada, so the efforts of Bill Rice, David Brown, David Wilson and Purdy Crawford to coverup this fact are falling on deaf ears. The longstanding efforts of these men to coverup white collar crime and to mitigate Canada's prosecutorial response to it can only be interpreted to be a breach of trust to the Canadian people.
In a recent survey (EKOS Survey, Wave 3, 2005-2006), Canadians said economic crime was the most serious problem in Canada at 67%, gang violence rated second at 66%, and gun crime and organized crime both rated third at 54%. Terrorism rated last at 14%. When asked about what type of crimes Canadians were personally more concerned about, those polled rated economic crime first at 68%, gang violence second at 59%, gun crime third at 51%, property crime forth at 48%. Terrorism rated last at 30%.
(RCMP Integrated Market Enforcement Teams Accountability Framework - Fiscal Year Ending March 31, 2006)
On April 26, 2007, the National Pensioners & Senior Citizens Federation (450 clubs and chapters with 1,000,000 members), the United Senior Citizens of Ontario (1000 clubs with 300,000 members) and the Small Investors Protection Association jointly requested a national inquiry on the malfunctioning of Canada's securities and accounting regulation and white collar crime enforcement system.
Diane Urquhart
Independent Analyst
Tel: (905) 822-7618
Cell: (416) 505-4832
Canadians say send Black to jail
69% of those surveyed believe convicted tycoon should serve time
July 30, 2007
Canadian Press
OTTAWAAuthor, biographer, British lord, business tycoon, media mogul and convicted criminal. And now, suggests a new Canadian Press-Decima poll, you can add soothsayer to Conrad Black's list of titles.
"The destructive fixation of the envious English-Canadian mind requires that the highest, happiest, most agile flyers be laid low," Black wrote in his 1993 memoir, Conrad Black: A Life In Progress.
He called it "a sadistic desire corroded by soul-destroying envy, to intimidate all those who might aspire to anything the slightest exceptional."
Judging by public reaction to Black's recent conviction by a Chicago jury, the multi-millionaire businessman got that right.
The survey of more than 1,000 Canadians found that only 8 per cent think the American jury was too severe in convicting Black on four of 11 charges earlier this month. Forty-eight per cent say the jury got it about right and 22 per cent said the verdict was not severe enough.
Black, convicted on counts of mail fraud and obstruction of justice, won't be sentenced until November but he should take some small solace that Canadian public opinion won't influence his penalty.
Decima found that most respondents 69 per cent would like Black to see jail time in addition to paying a fine. Just 10 per cent believed a fine is ample punishment.
Some 29 per cent felt he should be sentenced to 10 years or more in prison, with another 40 per cent feeling that one to nine years would suffice. Black, who gave up his Canadian citizenship in 2001 to accept a British peerage, is appealing the conviction.
Among the four in 10 respondents who said they followed his criminal trial closely, opinions against Black were no better and in some cases, more harsh. Some 60 per cent of respondents rising to 71 per cent among close followers of the trial said the Montreal-born Black's Canadian citizenship should not be reinstated.
Bruce Anderson, Decima's CEO, said the poll is a clear signal that "most of those Canadians who passed judgment on Conrad Black, came to similar conclusions as the jury did.
"Most show little sympathy for Mr. Black, and see no reason why he should have his citizenship restored, or maintain his Order of Canada designation."
The poll, conducted July 19-22, has a margin of error of plus or minus 3.1 percentage points, 19 times in 20.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
verses a ZERO score for corporate criminals in Canada
by admin » Wed Jul 18, 2007 12:59 pm
Thanks to our efficient thirteen provincial and territorial securities ommissions, we here in Canada have no corporate crime. As opposed to our neighbors to the south.
http://www.latimes.com/business/la-fi-w ... s-business
From the Los Angeles Times
WALL STREET ROUNDUP
Justice Department touts its record
From Times Wire Services
July 18, 2007
Hundreds of high-ranking company officials have been convicted in corporate fraud schemes since 2002, the Justice Department said Tuesday, a day after a federal judge threw out charges in one of the largest criminal tax cases in U.S. history.
Atty. Gen. Alberto Gonzales called the U.S. District Court ruling, in favor of 13 former KPMG employees, disappointing but said it wouldn't deter the department from "pursuing wrongdoing where we think it exists."
In all, federal prosecutors have won 1,236 convictions in corporate fraud cases and reaped hundreds of millions in payback for victims over the last five years, Deputy Atty. Gen. Paul McNulty said.
At least one-third of the convictions came against company CEOs, presidents, counsel and other high-ranking executives, McNulty said.
http://www.latimes.com/business/la-fi-w ... s-business
From the Los Angeles Times
WALL STREET ROUNDUP
Justice Department touts its record
From Times Wire Services
July 18, 2007
Hundreds of high-ranking company officials have been convicted in corporate fraud schemes since 2002, the Justice Department said Tuesday, a day after a federal judge threw out charges in one of the largest criminal tax cases in U.S. history.
Atty. Gen. Alberto Gonzales called the U.S. District Court ruling, in favor of 13 former KPMG employees, disappointing but said it wouldn't deter the department from "pursuing wrongdoing where we think it exists."
In all, federal prosecutors have won 1,236 convictions in corporate fraud cases and reaped hundreds of millions in payback for victims over the last five years, Deputy Atty. Gen. Paul McNulty said.
At least one-third of the convictions came against company CEOs, presidents, counsel and other high-ranking executives, McNulty said.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
verses a ZERO score for corporate criminals in Canada
by admin » Wed Jul 18, 2007 12:58 pm
Thanks to our efficient thirteen provincial and territorial securities ommissions, we here in Canada have no corporate crime. As opposed to our neighbors to the south.
http://www.latimes.com/business/la-fi-w ... s-business
From the Los Angeles Times
WALL STREET ROUNDUP
Justice Department touts its record
From Times Wire Services
July 18, 2007
Hundreds of high-ranking company officials have been convicted in corporate fraud schemes since 2002, the Justice Department said Tuesday, a day after a federal judge threw out charges in one of the largest criminal tax cases in U.S. history.
Atty. Gen. Alberto Gonzales called the U.S. District Court ruling, in favor of 13 former KPMG employees, disappointing but said it wouldn't deter the department from "pursuing wrongdoing where we think it exists."
In all, federal prosecutors have won 1,236 convictions in corporate fraud cases and reaped hundreds of millions in payback for victims over the last five years, Deputy Atty. Gen. Paul McNulty said.
At least one-third of the convictions came against company CEOs, presidents, counsel and other high-ranking executives, McNulty said.
http://www.latimes.com/business/la-fi-w ... s-business
From the Los Angeles Times
WALL STREET ROUNDUP
Justice Department touts its record
From Times Wire Services
July 18, 2007
Hundreds of high-ranking company officials have been convicted in corporate fraud schemes since 2002, the Justice Department said Tuesday, a day after a federal judge threw out charges in one of the largest criminal tax cases in U.S. history.
Atty. Gen. Alberto Gonzales called the U.S. District Court ruling, in favor of 13 former KPMG employees, disappointing but said it wouldn't deter the department from "pursuing wrongdoing where we think it exists."
In all, federal prosecutors have won 1,236 convictions in corporate fraud cases and reaped hundreds of millions in payback for victims over the last five years, Deputy Atty. Gen. Paul McNulty said.
At least one-third of the convictions came against company CEOs, presidents, counsel and other high-ranking executives, McNulty said.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
Way to go BC Securities Commission
by admin » Tue Jun 12, 2007 10:27 pm
NEWS RELEASE
2007/41
June 11, 2007
Commission overturns TSX Venture Exchange decision to disqualify Nichols
Vancouver - A British Columbia Securities Commission panel has overturned a TSX Venture Exchange decision that disqualified a man with a history of criminal convictions from performing investor relations activities.
On June 7, 2007, the commission panel set aside the TSX-V exchange's decision that William John Nichols is unacceptable to perform investor relations activities on behalf of any Exchange-listed company and must obtain Exchange approval to do any work for a listed company.
The Exchange disqualified Nichols because of his criminal convictions in 1976 for robbery, theft, and breaking and entering, and because he initially disclosed only his first-degree murder conviction in his personal information form.
The Exchange stated that "in order to foster investor confidence in the Exchange it is prudent for the Exchange to protect its reputation by refusing to be associated with persons having such a serious criminal history as Mr. Nichols does."
The commission panel found that, in reaching its decision, the Exchange overlooked material evidence, including:
the fact that Nichols made no attempt to conceal his first-degree murder conviction and promptly provided full information about all of his convictions when the Exchange requested more information
Nichols' release from prison under the 'faint hope' clause, the passage of time and evidence of rehabilitation since his conviction for murder, and his past work for Exchange-listed companies
In setting aside the Exchange's decision, the commission panel said that "the Exchange could not reasonably conclude, based on the evidence before us, that it should disqualify Nichols from performing investor relations activities for listed companies."
The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the decision on our website www.bcsc.bc.ca by typing in the search box, William John Nichols or 2007 BCSECCOM 319. If you have questions, contact Ken Gracey, Media Relations, 604-899-6577.
2007/41
June 11, 2007
Commission overturns TSX Venture Exchange decision to disqualify Nichols
Vancouver - A British Columbia Securities Commission panel has overturned a TSX Venture Exchange decision that disqualified a man with a history of criminal convictions from performing investor relations activities.
On June 7, 2007, the commission panel set aside the TSX-V exchange's decision that William John Nichols is unacceptable to perform investor relations activities on behalf of any Exchange-listed company and must obtain Exchange approval to do any work for a listed company.
The Exchange disqualified Nichols because of his criminal convictions in 1976 for robbery, theft, and breaking and entering, and because he initially disclosed only his first-degree murder conviction in his personal information form.
The Exchange stated that "in order to foster investor confidence in the Exchange it is prudent for the Exchange to protect its reputation by refusing to be associated with persons having such a serious criminal history as Mr. Nichols does."
The commission panel found that, in reaching its decision, the Exchange overlooked material evidence, including:
the fact that Nichols made no attempt to conceal his first-degree murder conviction and promptly provided full information about all of his convictions when the Exchange requested more information
Nichols' release from prison under the 'faint hope' clause, the passage of time and evidence of rehabilitation since his conviction for murder, and his past work for Exchange-listed companies
In setting aside the Exchange's decision, the commission panel said that "the Exchange could not reasonably conclude, based on the evidence before us, that it should disqualify Nichols from performing investor relations activities for listed companies."
The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the decision on our website www.bcsc.bc.ca by typing in the search box, William John Nichols or 2007 BCSECCOM 319. If you have questions, contact Ken Gracey, Media Relations, 604-899-6577.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Thu Jun 07, 2007 8:06 am
Do you guys remember when "independent" brokers here were holding seminars
telling workers some teachers to cash in their pension plans for better
returns with advisor sold mutual funds and the like. Read below.
Citigroup Inc. will pay US$15.2-million to settle charges its brokers
induced hundreds of BellSouth Corp. workers to retire early and open
accounts that cost them much of their nest eggs, the National Association of
Securities Dealers said yesterday.
According to the NASD, the largest U.S. bank failed to supervise brokers who
conducted dozens of seminars for BellSouth workers
It said the brokers led workers to believe they could earn 12% a year on
their investments, but did not properly explain the risks and disclose the
fees.
More than 400 workers, typically unsophisticated investors in their mid-50s
with less than US$350,000 of retirement savings, opened in excess of 1,100
accounts.
"Given the ages of these folks, when they make mistakes, they don't have the
time horizons to recover," said James Shorris, the NASD enforcement chief,
in an interview. "That's what's tragic in this case. Many people had
substantial retirement nest eggs, but some had to go back to work to recoup
what they lost. What was promised as a dream ended up being a nightmare."
http://www.canada.com/nationalpost/fina ... f2cf74989c
telling workers some teachers to cash in their pension plans for better
returns with advisor sold mutual funds and the like. Read below.
Citigroup Inc. will pay US$15.2-million to settle charges its brokers
induced hundreds of BellSouth Corp. workers to retire early and open
accounts that cost them much of their nest eggs, the National Association of
Securities Dealers said yesterday.
According to the NASD, the largest U.S. bank failed to supervise brokers who
conducted dozens of seminars for BellSouth workers
It said the brokers led workers to believe they could earn 12% a year on
their investments, but did not properly explain the risks and disclose the
fees.
More than 400 workers, typically unsophisticated investors in their mid-50s
with less than US$350,000 of retirement savings, opened in excess of 1,100
accounts.
"Given the ages of these folks, when they make mistakes, they don't have the
time horizons to recover," said James Shorris, the NASD enforcement chief,
in an interview. "That's what's tragic in this case. Many people had
substantial retirement nest eggs, but some had to go back to work to recoup
what they lost. What was promised as a dream ended up being a nightmare."
http://www.canada.com/nationalpost/fina ... f2cf74989c
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
another potential crime covered by confidentiality
by admin » Sat Mar 31, 2007 11:46 am
Imagine yourself (or your parents) having to spend the last ten years of your life fighting with a trusted bank to get compensation.
They are spending their own credibility with this kind of treatment of the public.
----- Original Message -----
From: Stan Buell Founder & President of www.sipa.ca
To: SIPA Contacts
Sent: Saturday, March 31, 2007 1:28 PM
Subject: CANCELLED! Securities litigation scheduled for Monday April 2
The case between Mary Diwell and ScotiaMcLeod & Frank L. Cestnik scheduled to be heard Monday at noon has been cancelled.
Yesterday ScotiaMcLeod offered an out of court settlement which has been accepted by the Plaintiff. The Monday litigation is cancelled.
I would like to especially thank those who said they would attend as well as those who expressed interest in the case. We will have additional information later.
It is most unfortunate that it is impossible for aggrieved investors to get justice. That is why most cases are settled out-of-court and very few make it through to getting a court decision that will build precedent for case law.
Inevitably the industry defends vigorously situations that appear indefensible and then agree to settle out of court in the final hour to cover up the wrongdoing.
However, there are a number of decisions that support the concept of investment advisors and their firms having fiduciary duty, and when investment firms breach the rules they are held accountable by the courts.
Some judges have ordered that monies be paid prior to the appeal process when it is obvious there is no doubt of the outcome and the industry is only appealing to frustrate justice.
Some recent cases have included significant punitive damages.
So, I will not be at Timothy's as scheduled.
I would add that Mary's husband is a senior and the stress of this whole situation has made life difficult for them. Aggrieved investor's must always take into account factors other than money and determine the best course of action for their particular situation with health and wellness being of utmost importance.
They had been battling for several years and the battle takes its toll. With the justice system one can never be sure that you will win even though you are right and the breaches can not be disputed.
As Armand Laflamme found out ... The first court decision made an award to him but this was appealed. they went through three levels of court and finally the Supreme Court awarded him his money. It took him ten years and no doubt this had a significant impact on his health and wellbeing. He died a few years later. Was this justice?
One can not recommend that aggrieved investors spend most of the rest of their lives fighting a case that is difficult to win when they are the only victims.
That is why we must continue to fight for justice, protection for small investors, and better dispute resolution.
Thank you for your support.
Stan Buell
Small Investor Protection Association
P.O.Bos 325, Markham, ON, L6B1A8
website: www.sipa.ca
e-mail: sipa@sipa.ca
They are spending their own credibility with this kind of treatment of the public.
----- Original Message -----
From: Stan Buell Founder & President of www.sipa.ca
To: SIPA Contacts
Sent: Saturday, March 31, 2007 1:28 PM
Subject: CANCELLED! Securities litigation scheduled for Monday April 2
The case between Mary Diwell and ScotiaMcLeod & Frank L. Cestnik scheduled to be heard Monday at noon has been cancelled.
Yesterday ScotiaMcLeod offered an out of court settlement which has been accepted by the Plaintiff. The Monday litigation is cancelled.
I would like to especially thank those who said they would attend as well as those who expressed interest in the case. We will have additional information later.
It is most unfortunate that it is impossible for aggrieved investors to get justice. That is why most cases are settled out-of-court and very few make it through to getting a court decision that will build precedent for case law.
Inevitably the industry defends vigorously situations that appear indefensible and then agree to settle out of court in the final hour to cover up the wrongdoing.
However, there are a number of decisions that support the concept of investment advisors and their firms having fiduciary duty, and when investment firms breach the rules they are held accountable by the courts.
Some judges have ordered that monies be paid prior to the appeal process when it is obvious there is no doubt of the outcome and the industry is only appealing to frustrate justice.
Some recent cases have included significant punitive damages.
So, I will not be at Timothy's as scheduled.
I would add that Mary's husband is a senior and the stress of this whole situation has made life difficult for them. Aggrieved investor's must always take into account factors other than money and determine the best course of action for their particular situation with health and wellness being of utmost importance.
They had been battling for several years and the battle takes its toll. With the justice system one can never be sure that you will win even though you are right and the breaches can not be disputed.
As Armand Laflamme found out ... The first court decision made an award to him but this was appealed. they went through three levels of court and finally the Supreme Court awarded him his money. It took him ten years and no doubt this had a significant impact on his health and wellbeing. He died a few years later. Was this justice?
One can not recommend that aggrieved investors spend most of the rest of their lives fighting a case that is difficult to win when they are the only victims.
That is why we must continue to fight for justice, protection for small investors, and better dispute resolution.
Thank you for your support.
Stan Buell
Small Investor Protection Association
P.O.Bos 325, Markham, ON, L6B1A8
website: www.sipa.ca
e-mail: sipa@sipa.ca
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Mon Jun 05, 2006 11:29 pm
similar sales practices in Canada qualify as "standard industry behavior", and regulators look the other way
Targeting the Elderly: Annuity tactics under fire
Sunday, June 04, 2006
By Joe Gardyasz, joegardyasz@bpcdm.com
Imagine that an insurance agent contacts your elderly mother or grandmother who’s living in Florida or California, purporting to be an expert in living trusts. He persuades her to provide him with detailed information on her investment portfolio, and after gaining her trust, advises her to move a significant portion of her savings into an annuity, without telling her that she’ll only be able to access 10 percent of her money per year without incurring a surrender charge.
This scheme, according to lawsuits brought by both state regulators and private attorneys, has allegedly been used to sell sell hundreds of millions of dollars in annuities to elderly residents who needed short-term investments or immediate income, not a long-term investment that would, in some instances, lock up their savings longer than they would be expected to live.
Take the case of Murray Cheves. When he was 90, the California resident was sold a $100,000 annuity issued by American Investors Life Insurance Co., a subsidiary of Des Moines-based AmerUs Group Co. The annuity had surrender charges that were effective for 10 years from the issue date. After Cheves died a year later, his heirs had to pay the $11,000 surrender charge.
“When you start hearing these stories, it really gets heart-wrenching,” said Scott McNamara, senior staff counsel for the enforcement bureau of the California Department of Insurance. In February 2005, the department and the California attorney general filed suit against AmerUs, seeking $110 million in restitution and damages on behalf of thousands of California seniors.
In the Cheves case, which became a national class-action suit, AmerUs reached a $6.24 million settlement in November.
AmerUs officials deny any wrongdoing and say their policies ensure their clients meet suitability standards for the products being sold.
American Equity Investment Life Investors Co. of West Des Moines, which is the nation’s second-largest issuer of indexed annuities, is also the subject of lawsuits alleging inappropriate sales of those products. The company is now appealing a proposed settlement in one of those cases, which involved approximately 28,000 seniors in Florida. That settlement, according to an attorney representing the plaintiffs, would require American Equity to waive all penalties for early withdrawal of savings and increase the value of each person’s account by 2 percent when it’s annuitized.
American Equity officials did not respond to phone calls from the Business Record. However, according its most recent quarterly filing with the SEC last month, the company is “currently a defendant in several purported class action lawsuits alleging improper sales practices,” and also said it has “denied all allegations in these lawsuits and intends to vigorously defend against them,” and that it “does not believe the lawsuits will have a material adverse effect on its business, financial condition or results of operations.”
In its first-quarter earnings release, the company also said it monitors its sales practices “on a continuous basis” and was among the first in the index annuity issuers to ndustry to adopt writers to require a suitability review of sales of annuities to consumers of all states.
No more free lunches?
The annuity industry continues to be the subject of scrutiny at both the federal and state levels. On May 8, the U.S. Securities and Exchange Commission and the North American Securities Administrators Association announced a joint national initiative aimed at cracking down on investment fraud against seniors. Those efforts will include targeted examinations to detect abusive sales tactics, aggressive enforcement of securities laws in cases of fraud against seniors and active investor education and outreach.
“As the nation’s assets increasingly are held by older Americans, fraudsters can be expected to follow Willie Sutton’s example and go where the money is,” SEC Chairman Christopher Cox said in a press release. “That’s why the SEC’s partnership with state regulators to safeguard the assets of older Americans is so important.”
Federal and state regulators, in coordination with the National Association of Securities Dealers, have already initiated on-site examinations of firms in Florida that sponsor “free lunch” investment seminars for seniors, which are often used as a first step in pitching annuities that are unsuitable for elderly investors.
At the same time that some Iowa insurers are defending themselves against serious allegations of wrongdoing, they’re taking what Iowa regulators say is an active role to strengthen rules governing the sale of annuities. About 34 percent of the indexed annuity products sold in the United States are issued by Iowa-based insurance companies.
“Many of our Iowa companies have moved to suitability standards before it’s been enacted [at the state level],” said Tom Alger, a spokesman for the Iowa Insurance Division, who said his agency has not taken any legal actions against Iowa-based companies that issue annuities. “We’re looking at this [issue] very actively, and with the participation of Iowa-based producers, which at least at this point are showing a great deal of cooperation.”
In California, the case brought against AmerUs by the insurance department and attorney general is in mediation, and is expected to either reach a settlement or go to trial within the next couple of months, McNamara said.
Living trust mills
The primary reason the state of California decided to pursue the case, he said, was AmerUs’ ownership of Family First Estate Planning and Family First Insurance Services through its American Investors Life Insurance subsidiary. Two of Family First’s owners, John Owen and Nick Michaels, had operated a “living trust mill” operation in California called Alliance of Mature Americans, which the state had shut down several years ago, McNamara said.
“We had never had that direct relationship between a trust mill and an insurer, which was what motivated us to bring this case,” he said. Family First Estate Planning drew up the living trust documents, while Family First Insurance Services sold the annuities. “My recollection is (Family First) sold something like 20,000 trusts,” McNamara said. “Of those, about 6,000 to 7,000 people bought annuities. Some of those consumers bought more than one annuity.”
That suit, and a half-dozen similar class-action suits filed against AmerUs in other states, are currently going through a consolidated discovery process in the U.S. District Court for the Eastern District of Pennsylvania before the cases are sent back to their respective states for trial.
“The complaints allege, among other things, the unauthorized practice of law involving the marketing of estate or financial planning services, the lack of suitability of the products, the improper manner in which they were sold, including pretext sales and non-disclosure of surrender charges, as well as other violations of the state consumer and insurance laws,” according to a statement by AmerUs in its latest quarterly report.
An AmerUs official declined to comment directly on the litigation, but said the company has taken “a leadership role” in working with the Insurance Marketplace Standards Association in developing suitability standards for the annuities industry.
“We certainly do believe products should be suitable and we want our consumers to be happy with the products,” said Chris Littlefield, senior vice president and general counsel for AmerUs. “We’ve certainly communicated to IMSA that we will follow these standards and that we have followed them … to make sure our consumers get suitable products.”
Because AmerUs adheres to maximum issue ages for its annuities, “I can tell you with great confidence that we’ve never sold 20-year policies to 85-year-olds,” Littlefield said. “Of the 15,000 independent agents that sell our products, can I tell you that they’re all doing the right thing? No. But our total complaints are less than 1 percent of all policies sold. We have extreme confidence that suitable products are being sold to seniors because we have maximum issue ages and surrender policies, and we don’t want business that generates litigation.”
Deceptive practices alleged
In November, the AmerUs reached a settlement in the Cheves class action suit filed in California which alleged that American Investors, Family First Estate Planning and Family First Insurance Services had engaged in deceptive practices related to sales of annuities to seniors. The allegations in this case involved claims of breach of contract, misrepresentation, unfair competition and deceptive trade practices.
American Investors is also among the insurers named in a suit filed by the Pennsylvania attorney general’s office that alleges that the company engaged in a living trust mill operation targeting seniors in that state. A second suit alleges that companies that sold AmerUs annuities were engaged in a similar scheme.
“We believe that, if not the parent companies, that one or more of the subsidiaries may be training people in the trust mill approach to these sales,” said Thomas Devlin, a senior deputy attorney general in the AG’s charitable trust and organizations section.
“These sales could be done legitimately,” Devlin said, but because of the lucrative commissions involved, “there’s tremendous temptation to cut corners. The potential to exert duress and pressure are pretty substantial, we believe.”
In Florida, a law firm with offices in Fort Lauderdale and Orlando began representing elderly residents in annuities cases five years ago with a case against American Equity Investment Life Insurance, which grew into a national class-action suit. The firm, Gordon Hargrove & James P.A., has filed approximately 40 annuity-related lawsuits that have either been settled or remain active.
“Agents, without proper training and supervision, have been foisting themselves upon seniors with products that don’t meet the needs of seniors for liquidity and flexibility,” said Cristina Pierson, a shareholder with the firm, which is also the co-lead counsel coordinating the AmerUs cases in Pennsylvania.
“The companies are preparing materials that are misleading, and are making material omissions in their presentations,” she said. “These are very complicated, complex products; there are a lot of moving parts. There are a lot of complex definitions that incorporate a lot of other complicated definitions. Even if the agents are experienced, it’s not a guarantee they can make these presentations. The companies aren’t training, and they’re not providing monitoring and supervision.”
Pierson said her firm has also filed individual suits against American Equity on behalf of clients who were either outside the scope of the class, or whose treatment was so outrageous that they wished to file individual claims. It also has two individual cases pending in state district court against AmerUs. In addition, it has “quite a few” cases against Allianz Life Insurance Co. The firm has also reached six settlements with Sioux Falls-based Midland National Life Insurance Co., whose annuity division is based in West Des Moines, and has two more annuity cases pending against that company, she said.
“I think you can see from the number of companies and number of lawsuits that there is an epidemic in the sales and marketing of indexed annuities,” she said. “Hopefully, taking this action will get the attention of not only the companies but also the regulatory agencies that govern these products and companies. Otherwise the epidemic is going to get worse.”
Jack Marrion, founder of Advantage Compendium Ltd., a St. Louis research and consulting firm that has tracked the annuity industry for the past 10 years, said he believes the increase in lawsuits is tied to the industry’s tenfold growth in the past decade. None of the suits he has seen appear to be a threat to the credibility of annuities as an investment vehicle, he said.
“I’ve read 15 of the suits, and not one says an index annuity was bad,” he said. “It alleges bad behavior by an agent, or they make claims that are just really strange.”
In analyzing all the complaints filed against annuity issuers in 2004, Marrion found an average of one complaint for roughly each $650 million of sales of both index and variable annuity sales. In 2005, however, the frequency of index annuity complaints increased to one for each $259 million in sales, compared with one complaint for each $729 million in sales of variable annuities.
Despite the increase, the level of complaints for index annuities is still lower than for many other insurance products, he said.
Brian Atchinson, president and CEO of the Insurance Marketplace Standards Association, said a primary concern of his organization is that agents selling annuities really understand the complex products. The IMSA has about 140 member companies that represent approximately 60 percent of the annuity marketplace.
“Iowa has been a leader among the states” in that effort, he said. In March, the state’s insurance division organized a briefing on annuities for the National Association of Insurance Commissioners. The division also asked IMSA to work with some of its member companies in Iowa to develop a model set of best practices, which were issued last month, for how indexed annuities are marketed and sold. Those standards address the measures agents must take to gather information and determine suitability for an annuity product, disclosure of both benefits and disadvantages of the product and agent training.
At the federal level, the SEC has said its regional offices will work closely with state and local law enforcement agencies to exchange information to help identify and bring administrative, civil and criminal actions to shut down scams targeting senior investors.
The SEC has produced a “senior care package” of brochures for seniors which is available on its Web site at www.sec.gov. Also, the North American Securities Administrators Association plans to expand the investor education materials for seniors available through its online senior investor resource center, which can be accessed by visiting www.nasaa.org and clicking on “investor education.”
Targeting the Elderly: Annuity tactics under fire
Sunday, June 04, 2006
By Joe Gardyasz, joegardyasz@bpcdm.com
Imagine that an insurance agent contacts your elderly mother or grandmother who’s living in Florida or California, purporting to be an expert in living trusts. He persuades her to provide him with detailed information on her investment portfolio, and after gaining her trust, advises her to move a significant portion of her savings into an annuity, without telling her that she’ll only be able to access 10 percent of her money per year without incurring a surrender charge.
This scheme, according to lawsuits brought by both state regulators and private attorneys, has allegedly been used to sell sell hundreds of millions of dollars in annuities to elderly residents who needed short-term investments or immediate income, not a long-term investment that would, in some instances, lock up their savings longer than they would be expected to live.
Take the case of Murray Cheves. When he was 90, the California resident was sold a $100,000 annuity issued by American Investors Life Insurance Co., a subsidiary of Des Moines-based AmerUs Group Co. The annuity had surrender charges that were effective for 10 years from the issue date. After Cheves died a year later, his heirs had to pay the $11,000 surrender charge.
“When you start hearing these stories, it really gets heart-wrenching,” said Scott McNamara, senior staff counsel for the enforcement bureau of the California Department of Insurance. In February 2005, the department and the California attorney general filed suit against AmerUs, seeking $110 million in restitution and damages on behalf of thousands of California seniors.
In the Cheves case, which became a national class-action suit, AmerUs reached a $6.24 million settlement in November.
AmerUs officials deny any wrongdoing and say their policies ensure their clients meet suitability standards for the products being sold.
American Equity Investment Life Investors Co. of West Des Moines, which is the nation’s second-largest issuer of indexed annuities, is also the subject of lawsuits alleging inappropriate sales of those products. The company is now appealing a proposed settlement in one of those cases, which involved approximately 28,000 seniors in Florida. That settlement, according to an attorney representing the plaintiffs, would require American Equity to waive all penalties for early withdrawal of savings and increase the value of each person’s account by 2 percent when it’s annuitized.
American Equity officials did not respond to phone calls from the Business Record. However, according its most recent quarterly filing with the SEC last month, the company is “currently a defendant in several purported class action lawsuits alleging improper sales practices,” and also said it has “denied all allegations in these lawsuits and intends to vigorously defend against them,” and that it “does not believe the lawsuits will have a material adverse effect on its business, financial condition or results of operations.”
In its first-quarter earnings release, the company also said it monitors its sales practices “on a continuous basis” and was among the first in the index annuity issuers to ndustry to adopt writers to require a suitability review of sales of annuities to consumers of all states.
No more free lunches?
The annuity industry continues to be the subject of scrutiny at both the federal and state levels. On May 8, the U.S. Securities and Exchange Commission and the North American Securities Administrators Association announced a joint national initiative aimed at cracking down on investment fraud against seniors. Those efforts will include targeted examinations to detect abusive sales tactics, aggressive enforcement of securities laws in cases of fraud against seniors and active investor education and outreach.
“As the nation’s assets increasingly are held by older Americans, fraudsters can be expected to follow Willie Sutton’s example and go where the money is,” SEC Chairman Christopher Cox said in a press release. “That’s why the SEC’s partnership with state regulators to safeguard the assets of older Americans is so important.”
Federal and state regulators, in coordination with the National Association of Securities Dealers, have already initiated on-site examinations of firms in Florida that sponsor “free lunch” investment seminars for seniors, which are often used as a first step in pitching annuities that are unsuitable for elderly investors.
At the same time that some Iowa insurers are defending themselves against serious allegations of wrongdoing, they’re taking what Iowa regulators say is an active role to strengthen rules governing the sale of annuities. About 34 percent of the indexed annuity products sold in the United States are issued by Iowa-based insurance companies.
“Many of our Iowa companies have moved to suitability standards before it’s been enacted [at the state level],” said Tom Alger, a spokesman for the Iowa Insurance Division, who said his agency has not taken any legal actions against Iowa-based companies that issue annuities. “We’re looking at this [issue] very actively, and with the participation of Iowa-based producers, which at least at this point are showing a great deal of cooperation.”
In California, the case brought against AmerUs by the insurance department and attorney general is in mediation, and is expected to either reach a settlement or go to trial within the next couple of months, McNamara said.
Living trust mills
The primary reason the state of California decided to pursue the case, he said, was AmerUs’ ownership of Family First Estate Planning and Family First Insurance Services through its American Investors Life Insurance subsidiary. Two of Family First’s owners, John Owen and Nick Michaels, had operated a “living trust mill” operation in California called Alliance of Mature Americans, which the state had shut down several years ago, McNamara said.
“We had never had that direct relationship between a trust mill and an insurer, which was what motivated us to bring this case,” he said. Family First Estate Planning drew up the living trust documents, while Family First Insurance Services sold the annuities. “My recollection is (Family First) sold something like 20,000 trusts,” McNamara said. “Of those, about 6,000 to 7,000 people bought annuities. Some of those consumers bought more than one annuity.”
That suit, and a half-dozen similar class-action suits filed against AmerUs in other states, are currently going through a consolidated discovery process in the U.S. District Court for the Eastern District of Pennsylvania before the cases are sent back to their respective states for trial.
“The complaints allege, among other things, the unauthorized practice of law involving the marketing of estate or financial planning services, the lack of suitability of the products, the improper manner in which they were sold, including pretext sales and non-disclosure of surrender charges, as well as other violations of the state consumer and insurance laws,” according to a statement by AmerUs in its latest quarterly report.
An AmerUs official declined to comment directly on the litigation, but said the company has taken “a leadership role” in working with the Insurance Marketplace Standards Association in developing suitability standards for the annuities industry.
“We certainly do believe products should be suitable and we want our consumers to be happy with the products,” said Chris Littlefield, senior vice president and general counsel for AmerUs. “We’ve certainly communicated to IMSA that we will follow these standards and that we have followed them … to make sure our consumers get suitable products.”
Because AmerUs adheres to maximum issue ages for its annuities, “I can tell you with great confidence that we’ve never sold 20-year policies to 85-year-olds,” Littlefield said. “Of the 15,000 independent agents that sell our products, can I tell you that they’re all doing the right thing? No. But our total complaints are less than 1 percent of all policies sold. We have extreme confidence that suitable products are being sold to seniors because we have maximum issue ages and surrender policies, and we don’t want business that generates litigation.”
Deceptive practices alleged
In November, the AmerUs reached a settlement in the Cheves class action suit filed in California which alleged that American Investors, Family First Estate Planning and Family First Insurance Services had engaged in deceptive practices related to sales of annuities to seniors. The allegations in this case involved claims of breach of contract, misrepresentation, unfair competition and deceptive trade practices.
American Investors is also among the insurers named in a suit filed by the Pennsylvania attorney general’s office that alleges that the company engaged in a living trust mill operation targeting seniors in that state. A second suit alleges that companies that sold AmerUs annuities were engaged in a similar scheme.
“We believe that, if not the parent companies, that one or more of the subsidiaries may be training people in the trust mill approach to these sales,” said Thomas Devlin, a senior deputy attorney general in the AG’s charitable trust and organizations section.
“These sales could be done legitimately,” Devlin said, but because of the lucrative commissions involved, “there’s tremendous temptation to cut corners. The potential to exert duress and pressure are pretty substantial, we believe.”
In Florida, a law firm with offices in Fort Lauderdale and Orlando began representing elderly residents in annuities cases five years ago with a case against American Equity Investment Life Insurance, which grew into a national class-action suit. The firm, Gordon Hargrove & James P.A., has filed approximately 40 annuity-related lawsuits that have either been settled or remain active.
“Agents, without proper training and supervision, have been foisting themselves upon seniors with products that don’t meet the needs of seniors for liquidity and flexibility,” said Cristina Pierson, a shareholder with the firm, which is also the co-lead counsel coordinating the AmerUs cases in Pennsylvania.
“The companies are preparing materials that are misleading, and are making material omissions in their presentations,” she said. “These are very complicated, complex products; there are a lot of moving parts. There are a lot of complex definitions that incorporate a lot of other complicated definitions. Even if the agents are experienced, it’s not a guarantee they can make these presentations. The companies aren’t training, and they’re not providing monitoring and supervision.”
Pierson said her firm has also filed individual suits against American Equity on behalf of clients who were either outside the scope of the class, or whose treatment was so outrageous that they wished to file individual claims. It also has two individual cases pending in state district court against AmerUs. In addition, it has “quite a few” cases against Allianz Life Insurance Co. The firm has also reached six settlements with Sioux Falls-based Midland National Life Insurance Co., whose annuity division is based in West Des Moines, and has two more annuity cases pending against that company, she said.
“I think you can see from the number of companies and number of lawsuits that there is an epidemic in the sales and marketing of indexed annuities,” she said. “Hopefully, taking this action will get the attention of not only the companies but also the regulatory agencies that govern these products and companies. Otherwise the epidemic is going to get worse.”
Jack Marrion, founder of Advantage Compendium Ltd., a St. Louis research and consulting firm that has tracked the annuity industry for the past 10 years, said he believes the increase in lawsuits is tied to the industry’s tenfold growth in the past decade. None of the suits he has seen appear to be a threat to the credibility of annuities as an investment vehicle, he said.
“I’ve read 15 of the suits, and not one says an index annuity was bad,” he said. “It alleges bad behavior by an agent, or they make claims that are just really strange.”
In analyzing all the complaints filed against annuity issuers in 2004, Marrion found an average of one complaint for roughly each $650 million of sales of both index and variable annuity sales. In 2005, however, the frequency of index annuity complaints increased to one for each $259 million in sales, compared with one complaint for each $729 million in sales of variable annuities.
Despite the increase, the level of complaints for index annuities is still lower than for many other insurance products, he said.
Brian Atchinson, president and CEO of the Insurance Marketplace Standards Association, said a primary concern of his organization is that agents selling annuities really understand the complex products. The IMSA has about 140 member companies that represent approximately 60 percent of the annuity marketplace.
“Iowa has been a leader among the states” in that effort, he said. In March, the state’s insurance division organized a briefing on annuities for the National Association of Insurance Commissioners. The division also asked IMSA to work with some of its member companies in Iowa to develop a model set of best practices, which were issued last month, for how indexed annuities are marketed and sold. Those standards address the measures agents must take to gather information and determine suitability for an annuity product, disclosure of both benefits and disadvantages of the product and agent training.
At the federal level, the SEC has said its regional offices will work closely with state and local law enforcement agencies to exchange information to help identify and bring administrative, civil and criminal actions to shut down scams targeting senior investors.
The SEC has produced a “senior care package” of brochures for seniors which is available on its Web site at www.sec.gov. Also, the North American Securities Administrators Association plans to expand the investor education materials for seniors available through its online senior investor resource center, which can be accessed by visiting www.nasaa.org and clicking on “investor education.”
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Thu May 25, 2006 10:28 am
Enron jury reaches verdict
by Jeffrey Kanige and Claire Poole
Updated 12:18 PM EST, May-25-2006
TOP DEAL HEADLINES
Movers & shakers: May 25, 2006
Former Enron Corp. chairman Kenneth Lay and former CEO Jeffrey Skilling were convicted Thursday, May 25, on fraud and conspiracy charges relating to the collapse of the one-time energy giant. But Skilling was acquitted of insider trading charges. The verdict in the four-month trial follows about five days of deliberations.
Skilling and Lay were accused of lying to investors and analysts to hide the failing financial health of Enron, which collapsed in December 2001 as the then-largest bankruptcy ever in U.S. history.
Skilling was charged with 28 counts of fraud, conspiracy, insider trading and lying to auditors, while Lay was charged with six counts of fraud and conspiracy. Both could serve decades in prison.
ADvocate comments..............call me cynical, call me jaded. I should be quite encouraged to see that justice can be done, but instead I am reminded that I live in Canada, where if this particular crime were to happen, we would not likely be investigating it, and if our police and securities regulators were somehow encouraged to investigate it, would not result in any action during my life time. If I am wrong, please show me something to encourage me and to correct my narrowed thinking.
by Jeffrey Kanige and Claire Poole
Updated 12:18 PM EST, May-25-2006
TOP DEAL HEADLINES
Movers & shakers: May 25, 2006
Former Enron Corp. chairman Kenneth Lay and former CEO Jeffrey Skilling were convicted Thursday, May 25, on fraud and conspiracy charges relating to the collapse of the one-time energy giant. But Skilling was acquitted of insider trading charges. The verdict in the four-month trial follows about five days of deliberations.
Skilling and Lay were accused of lying to investors and analysts to hide the failing financial health of Enron, which collapsed in December 2001 as the then-largest bankruptcy ever in U.S. history.
Skilling was charged with 28 counts of fraud, conspiracy, insider trading and lying to auditors, while Lay was charged with six counts of fraud and conspiracy. Both could serve decades in prison.
ADvocate comments..............call me cynical, call me jaded. I should be quite encouraged to see that justice can be done, but instead I am reminded that I live in Canada, where if this particular crime were to happen, we would not likely be investigating it, and if our police and securities regulators were somehow encouraged to investigate it, would not result in any action during my life time. If I am wrong, please show me something to encourage me and to correct my narrowed thinking.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
by admin » Tue May 09, 2006 5:24 pm
Michael Prue, Ontario NDP Finance Critic on the subject of the Ontario Government not implementing the recommendations of the August 2004 Standing Committee of Finance and Economic Affairs on the Five Year Review of the Ontario Securities Act.
The committee asked that a task force be set up to review everything about the SROs. If there was not a single regulator in Canada within one year, one of the recommendations was that a task force be set up to review the continued existence of the SROs with the role of changing them, of modifying them, of moving them, of developing a system either like the United States or the United Kingdom. A year has come and gone, 18 months have come and gone, and the government has chosen to do nothing.
There's the whole issue of restitution. I want to read a direct quote from the standing committee about restitution. The standing committee recommended "that the government work with the Ontario Securities Commission to establish a workable mechanism that would allow investors to pursue restitution in a timely and affordable manner, and that government report on its progress in this regard within 12 months." We're 18 months into it and nothing has been done in this regard.
You might ask why I'm talking about all of this stuff -- what's not in the bill. It's only because I am so severely disappointed. Back in October 2004, there was an all-party agreement and, I believed, a real opportunity to move this province forward, a real opportunity to make sure that people who go down to Bay Street and try to fiddle, people who steal money, people who rob pensioners, pension funds and other people of their hard-earned money in order to line their pockets would face the same consequences that they would in the United Kingdom, Switzerland, Germany, on Wall Street and in literally every other country on the face of this planet. It has not happened.
I would suggest that anybody who has any money in the market, either directly invested by them or if they have the money invested through a pension fund, should be extremely worried about the level of scams taking place in Ontario. Certainly, if they are caught in Ontario, virtually nothing happens to them. If they are caught in the United States, though, you can rest assured that they will be going to jail for a long time. And you can rest assured that if it happens in another country, be it Britain, the United States, Switzerland, France, Germany or anywhere else, there is an enforcement agency with teeth out there looking for them. In Ontario, we continue to follow Mr. Brown's advice that we are not out there to do enforcement action but simply to give a good image about investing in Ontario.
The committee asked that a task force be set up to review everything about the SROs. If there was not a single regulator in Canada within one year, one of the recommendations was that a task force be set up to review the continued existence of the SROs with the role of changing them, of modifying them, of moving them, of developing a system either like the United States or the United Kingdom. A year has come and gone, 18 months have come and gone, and the government has chosen to do nothing.
There's the whole issue of restitution. I want to read a direct quote from the standing committee about restitution. The standing committee recommended "that the government work with the Ontario Securities Commission to establish a workable mechanism that would allow investors to pursue restitution in a timely and affordable manner, and that government report on its progress in this regard within 12 months." We're 18 months into it and nothing has been done in this regard.
You might ask why I'm talking about all of this stuff -- what's not in the bill. It's only because I am so severely disappointed. Back in October 2004, there was an all-party agreement and, I believed, a real opportunity to move this province forward, a real opportunity to make sure that people who go down to Bay Street and try to fiddle, people who steal money, people who rob pensioners, pension funds and other people of their hard-earned money in order to line their pockets would face the same consequences that they would in the United Kingdom, Switzerland, Germany, on Wall Street and in literally every other country on the face of this planet. It has not happened.
I would suggest that anybody who has any money in the market, either directly invested by them or if they have the money invested through a pension fund, should be extremely worried about the level of scams taking place in Ontario. Certainly, if they are caught in Ontario, virtually nothing happens to them. If they are caught in the United States, though, you can rest assured that they will be going to jail for a long time. And you can rest assured that if it happens in another country, be it Britain, the United States, Switzerland, France, Germany or anywhere else, there is an enforcement agency with teeth out there looking for them. In Ontario, we continue to follow Mr. Brown's advice that we are not out there to do enforcement action but simply to give a good image about investing in Ontario.
- admin
- Site Admin
- Posts: 2843
- Joined: Fri May 06, 2005 9:05 am
- Location: Canada
49 posts
• Page 3 of 4 • 1, 2, 3, 4
Return to Click here to view forums
Who is online
Users browsing this forum: Bing [Bot] and 2 guests