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GET YOUR MONEY BACK! Misconduct and malpractice. Investment industry "best and worst practices". Information to improve public protection. Expert witness services for industry and investors. Forensic investment analysis. • View topic - Royal Commission or Judicial Inquiry Case #1

Royal Commission or Judicial Inquiry Case #1

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Re: Royal Commission or Judicial Inquiry

Postby admin » Tue May 12, 2009 9:18 am

regarding case study #1 for public inquiry, as example of how to use (or misuse) the legal system to assist in financial, legal and corporate abuse of another individual I post this info on Anton Piller orders. It is relevant in case #1 since a badly flawed and abusive Anton Piller order is on the record and was used to do serious damage to a person central to the truth coming out.

How is an Anton Piller order obtained?

In order to obtain an Anton Piller order, the plaintiff must meet three tests. These are:

1 there must be an extremely strong prima facie case against the defendant

2 the potential or actual damage to the plaintiff resulting from the defendant's alleged wrongdoing must be very serious, and

3 there must be clear evidence that the defendants have incriminating documents or things in their possession, and there is a real possibility that they may destroy such material if they were to become aware of the plaintiff's application.

Because the defendant is not in court to argue against the granting of the order, the plaintiff has a duty to make full and frank disclosure of all facts that could be taken into account by the judge in deciding the matter. This includes identifying any likely defences. They must disclose all known material facts or facts that would have been discovered by proper enquiries.

If the order is granted, the plaintiff will undertake to serve the papers that were relied upon in court on the defendant so that they will know the case against them. They must also undertake to compensate the defendant and third parties for any loss that they might suffer by reason of the order having been made, if the court later decides that this should occur.
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Re: Royal Commission or Judicial Inquiry

Postby admin » Thu Mar 26, 2009 8:01 am

Relating to executive bonus’s, taxpayer bailouts, hidden deals, ...................................from the pockets of Alberta taxpayers.

I noticed with interest that our auditor general reports that Alberta Treasury Branch executives violated corporate rules and paid executive bonus’s despite losing 1/4 billion of ATB deposits on toxic investments. At one time these executives had placed 47% of all ATB deposit into toxic investments. Like my own City of Lethbridge and University of Calgary, we are now forced to wait up to nine years to see if we get any money back at on these investments. These bonus payments are a direct cost to the Alberta public, who own 100% of the Treasury Branch.

Source: Report of the Auditor General of Alberta
http://www.oag.ab.ca/files/oag/Oct_2008_Report.pdf

I cringed when I recalled that Alberta taxpayers guarantee 100% of the deposits on all ATB deposits. We may yet have to pay a second time as a result of this failed investment paper? No one knows and only time will tell.

But when I read the report of the auditor general, saying that funds and additional loans had to be provided to the ATB to support the loss from these toxic investments, I realized that Alberta taxpayers have already paid a second time for the additional funds needed to keep this bank solvent. Solvency needed after the investment managers placed nearly half the deposit funds into toxic investments.

The Alberta taxpayer has now paid a third time, when one considers that a joint federal/provincial bailout package was required in order to fund repayment to some clients who held investments in the toxic product. Clients who held less than $1 million of the bad paper, were given a full refund to help facilitate a restructuring.

When I received a recent letter from Finance Minister Iris Evans department admitting that our Alberta Securities Commission approved of permissions to “approximately 20 issuers of financial paper”, to sell this known toxic product to our Alberta citizens and institutions, I realized that all Albertans had been sold out by our own securities regulators, and by our Finance Minister. She found there to be nothing wrong, and nothing worthy of inquiry.

Alberta Finance letter posted at http://web.me.com/lelford/breachoftrust.ca/Blog

I trust that Alberta Premier Ed Stelmach will salvage this situation by convening a public inquiry under the Provincial Inquiries Act, into the actions and possible negligence involved inside our own protective financial agencies.

Larry Elford
Founder and director
www.investoradvocates.ca
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Re: Royal Commission or Judicial Inquiry

Postby admin » Thu Feb 12, 2009 10:27 am

This article refers to Anton Piller orders, one of which was used to assist in bullying and intimidating an industry whistleblower to his death. The Anton Piller order was used in such a manner as to ensure a win for the lawyer and his predatory client, and a death for the poor individual who was trying to point out fraud. Score: Millionaire fraudsters one, truthteller's zero.

Canada: The Civil Sheriff Comes Knocking On The Door — Anton Piller Orders
16 July 2008
Article by James Farley
Often cited as the most draconian of civil procedural remedies, the Anton Piller (AP) order is poorly understood by both the public and the litigating bar generally. The recent case of Nac Air, LP v. Wasaya Airways Ltd., 2007 CanLII 51168 (ON S.C.) demonstrates that this lack of appreciation for the underpinning principles of the AP order may also extend to the judiciary.

To be fair to all three sectors named, the AP order, which has been described by the Supreme Court of Canada (SCC) in Celanese Canada Inc. v. Murray Demolition Corp., [2006] 2 S.C.R. 189 as a "private search warrant," is not something one encounters every day. However, if one is on either end of such a drastic order, then it is extremely important to note just what terms, limits and conditions should prevail in the application for, granting of and execution of such an order.

The NAC case is somewhat reminiscent of the Air Canada-WestJet internal website access and garbage pickup dispute. NAC apparently had been required to file fare changes with a federal department, Health Canada. It was alleged that every time it did so, a competitor, Wasaya, immediately countered with its own change. Health Canada denied any leak on its part. NAC proceeded to obtain an AP order in the usual "without notice" way.

The nature of an AP order is that it compels the defendant to consent to a search team entering its premises to effect a review of material so that evidence for a civil suit may be preserved. Failure to consent places the target of the search at risk of contempt of court if the AP order is ignored. The target therefore has a "Hobson's Choice," i.e., a choice between taking the only option offered or not taking it. Needless to say, neither choice is particularly palatable.

The Celanese case provided that four essential conditions must exist for making an AP order:

First, the plaintiff must demonstrate a strong prima facie case.

Second, the damage to the plaintiff caused by the defendant's alleged misconduct — potential or actual — must be very serious.

Third, there must be convincing evidence that the defendant has in its possession incriminating documents or things.

And fourth, it must be shown that there is a real possibility the defendant may destroy such material before the discovery process can do its work.

It is interesting to note that the case from which the AP order originated, Anton Piller KG v. Manufacturing Processes Ltd., [1976] 1 Ch. D. 55 (C.A.), provided that there be an extremely strong prima facie case, and this is what the reviewing judge in NAC set as the test. However, that same judge required a probability of risk of destruction of material before discovery, not a real possibility as set out by the SCC.

The SCC helpfully pointed out various protections that should be incorporated in any AP order granted. These include:

In addition to the search team from the plaintiff's law firm, an independent outside lawyer should be appointed to supervise the execution of the order as an officer of the court. While such a process ideally should be conducted by independent outside lawyers, in practical terms, such an outside team would be at a "knowledge" disadvantage as to what was relevant to the case. An AP order is to be executed in an efficient and timely way. Thus practicality dictates that plaintiff's counsel may be involved, although it might be preferable to have the persons involved in the search team isolated behind a confidentiality wall from those who actually continue with the substance of the proceedings until such time as the documents would otherwise be ordinarily produced in the discovery process. This is because the intention of the AP order is to preserve evidence — not to allow a plaintiff to get a jump on the defendant in the discovery process.

An exception to the prohibition against immediate use of information obtained in the seizure is in the area of counterfeiting or piracy, where it has been found to be appropriate to give a "rolling" AP order vertically to suppliers and customers of the defendant — so as to trace up and down the supply chain those who may be involved in the alleged wrongdoing.

The scope of the order should be no wider than necessary. In NAC, 800,000 documents were seized. The reviewing judge found that some of these should not have been seized, including the computer records of the wife of the owner of Wasaya and Wasaya material that pre-dated any alleged problem. Further, many documents proved irrelevant to the litigation and contained a great deal of information that could possibly have given the plaintiff a competitive advantage over the defendant.

However, what is not appreciated in either NAC or Celanese is that if the AP order is to be efficiently executed, then unless a defendant wishes its premises to be tied up for months to do a minute scrutiny review, the reasonable tendency is to over-include. Is this a real problem? Not if one remembers the purpose of an AP order being to preserve evidence. Certainly the plaintiff itself should not have access to the seized material, and it would be desirable that there be an undertaking by searching counsel not to discuss the contents of what was seized with the plaintiff client. Computer records are probably the easiest to deal with as an electronic copy may be made and placed in safekeeping. Copying paper documents would be considerably more time-consuming. The winnowing down of these documents may be facilitated by a discussion between plaintiff's and defendant's counsel.

The supervising lawyer should ensure that material that is potentially the subject of solicitor-client privilege is sealed until this issue can be resolved. This points out the importance of the search team not discussing what was searched.
The AP order should limit the use to which the materials seized may be put. This again illustrates that the purpose of an AP order is to preserve evidence — subject to the rolling exception with respect to counterfeiting and piracy cases.

The material seized should be returned to the defendant as soon as possible. This may be accomplished by a proper indexing of the seized material, with the index being kept in safekeeping, and a copy given to defence counsel (or a copy of the electronic material to that counsel). Defence counsel and the defendant would know that if the proper discovery disclosure was not made, this could be checked against the electronic material or index in safekeeping.

Celanese provided for additional items regarding the execution of the search and subsequent to the search that were not an issue in NAC. These include:

the normal requirement for the plaintiff to give an undertaking to pay damages in the event that the AP order turns out to be wrongfully executed or unwarranted, keeping in mind the ex parte requirement of full and frank disclosure includes possible defences, objections or requirements of the target who is not there on the original hearing to make these points — but that lack of disclosure of immaterial points will not diminish an AP order on review (see Bell ExpressVu Limited Partnership v. EchoStar Satellite LLC, 2008 Can LII 12837 (ON S.C.) relying on Ontario Realty Corp v. P. Gabriele & Sons Ltd., [2000] O.J. No. 4341);

provision of a short wait time to allow the target to consult counsel;

a clause to allow the target to return to court on short notice;

arrangements for the search to be conducted during normal business hours;

provision that the premises not be searched except when a responsible person of the target is present;

provision that the search team be limited in number and identified;

provision that the order be explained in plain language before the search begins;

arrangements for a detailed list of the evidence seized to be made, and for the supervising solicitor to providing this list to the defendant for verification before materials are removed (alternatively, if this is not practicable, the document should be placed in the custody of the supervising solicitor and the target's counsel given the reasonable opportunity to review or make safekeeping arrangements for disputed ownership materials;

recognition that the supervising solicitor's obligations continue beyond the search to all matters arising out of the search;

a requirement that the supervising solicitor file a timely report with the court regarding the execution; and

likely a provision for an automatic court review of the execution on a short, timely basis.

However, it is perhaps troubling that the SCC assumes, without discussion, that the plaintiff will have a direct and immediate access to uncontested material seized subject to the counterfeiting and piracy exception. This ignores that the purpose of an AP order should be to merely preserve evidence.

In NAC, the AP order was voided on review and costs will ensue against the plaintiff. The reviewing judge was impressed by the fact that there was no allegation of intentional destruction of computer records, but rather the concern that these records would deteriorate with overwriting in the normal course (this problem would be solved by the provision of the electronic copy to be preserved). Also there was concern that the plaintiff had not sought the order as early as March 2007, but had waited until November. But why should this matter in the circumstances? One might easily criticize the plaintiff for leaping without looking if it rushed into court.

We have discussed the issue of a real possibility of destruction versus the NAC reviewing judge requiring a probability of destruction. However, it should be noted that in an AP situation, it is necessary to show some element of wrongdoing in the character of the defendant (or its controlling persons). Evidently, the strange coincidence of a contemporaneous change of fares did not provide this implication; something more is needed. As discussed in Ontario Realty Corp., the real possibility of destruction or suppression of records may be supported by some character flaw of wrongdoing of the deceitful nature, not necessarily linked to the case at hand; however, it is not necessary to show a past record of destroying or suppressing evidence or a previous judicial finding of fraud or deceit.

The NAC decision observed that even if the requisite degree of risk of destruction were shown, it would be "unlikely the court could fashion an order to protect from disclosure documents seized that are confidential or subject to solicitor-client privilege, or simply irrelevant to the issues between the parties." However, if the points discussed above were employed, it would seem that that could be achieved. Fortunately, in NAC, the reviewing judge did order all parties "to preserve documents relevant to the issues in this litigation and to produce such documents as may be required in accordance with the Rules of Civil Procedure." One would think that defence counsel and the defendant would be alerted to the necessity to ensure that proper discovery ensued.

The judge in Bell ExpressVu was fairly pragmatic in his review role and did not find that the various fairly inconsequential complaints of the target merited an overturning of the AP order in the particular circumstances of that case. This approach would seem to be the reasonable way of dealing with a review.

The lesson to be learned: it is better to be the applicant for than the target of an AP order — but the applicant must be careful to ensure that it makes full and frank disclosure to the court, that the proposed order provides all the appropriate safeguards, and that the AP order is properly executed. It should also be noted that the Commercial List Users' Committee is working on a model template for AP orders (which may be adjusted, with blacklining to note the changes, to meet the circumstances of the particular case). This template will likely go a long way toward regularizing this sector of the legal "Wild, Wild West."
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Re: Royal Commission or Judicial Inquiry

Postby admin » Sat Jan 17, 2009 10:58 pm

Jan 17, 2009

To: Premier Ed Stelmach,

In a Jan 15th Globe and Mail newspaper article by Kevin Carmichael of Ottawa, you were quoted as saying that there has not been a scandal in the Canadian markets that would justify having government focus its energy on overhauling the securities system instead of the economy.

The Alberta Securities Commission (ASC) has knowingly allowed tainted investments to be sold in Alberta. Investments that did not meet our securities laws. Iris Evan’s department has admitted that there were 22 exemptions to our laws to facilitate the sale of ABCP and short term commercial paper. This has hurt our economy.

1. These legal exemptions were done with the help of our very own crown corporation, the ASC, which calls into question the public interest value of this agency.

2. They were done in secret, which is why you may not be aware of them. Back-room deals, done between investment firms and the ASC, for a fee. There was no public notice, nor public input into allowing our laws to be violated. The ASC and the investment firms have effectively hidden vital information from the public on investments which have ended up costing billions of dollars. A scandal, done in secret is still a scandal.

3. The total economic costs of financial frauds and crimes against Canadians is growing to somewhere between $50 billion and $100 billion per year due to a failed securities regulatory system. (source, BREACH OF TRUST) These numbers are equal to two or three times the budget for Alberta. It is an economic tsunami, and you must deal with it.

4. The economic costs of frauds, abuses and crimes like these, against Canadians is, according to government of Statistics Canada and Justice Canada, greater than the costs of each and every other crime in Canada. Imagine ignoring financial damage sufficient to equal every robbery, auto theft, property crime, murder, mugging, break and enter etc., etc.

I have submitted to your finance minister, Iris Evans, two (2) case studies recently, that clearly illustrate how the Alberta Securities Commission has aided in pulling the wool over the eyes of the public while damaging the public. Damaging our economy.

In the interests of full public discourse, I am asking you to open a provincial inquiry into these two case studies to show the public if there is any cause for concern. You will discover that there has been more than one scandal that justifies an overhaul of the securities system.

I thank you for your time and for your timely response to this matter on behalf of all Albertans.

Larry Elford (former CIM, CFP, FCSI, Associate Portfolio Manager, retired)
Executive Director of investoradvocates.ca
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Re: Royal Commission or Judicial Inquiry

Postby admin » Wed Dec 17, 2008 6:20 pm

TOXIC INVESTMENTS? TAINTED OVERSIGHT BODY? WHAT TO DO?

Open letter and questions for the Alberta Securities Commission, Alberta Finance Department and Finance Minister Iris Evans. December 15, 2008

This letter refers to Asset Backed Commercial Paper (ABCP) that has turned out to be very damaging to the public. These are substandard investments that were allowed into each province much like a shipment of tainted meat. They were allowed by the Alberta Securities Commission despite knowledge that they did not meet our laws.
It also refers to other tainted investment products and tainted investment advice that keep occurring without apparent regard for the public interest, too often assisted by the Alberta Securities Commission.

1. Now that the securities commission has been found to have “exempted” our laws so that tainted investments could be sold to the public, will your government convene a commission of inquiry under the Provincial Inquiries Act in order to determine what liability this poses to the government, and what possible public interest was served by granting these exemptions?

2. With literally thousands of permissions granted to investment firms, to violate our securities laws, is it perhaps time to revisit the functionality or the usefulness of our provincial securities commissions? Are they serving the public or are they captured by the industry?

View thousands of legal permissions to violate securities laws at www.osc.gov.on.ca in category of “orders, rulings, decisions.

3. What public interest is served by allowing full and open access to the provincial securities commissions to investment firms who wish to violate our laws and sell tainted products or advice, while an ordinary citizen is not allowed to deal with this same securities commission. An ordinary citizen is referred by the commission to instead go to self-regulatory agencies, which are shown to owe no duty of care to the public. Can your commission or your government tell the public why we have two tiers within our securities commissions, one to serve the industry when it wishes to break our laws, and the other which does not serve the public when our laws are broken?

4. Will the Finance Minister or the Securities Commission please inform the public as to why they give no public notice to investors when an investment is being given permission to violate our securities laws?

5. Will the government tell us what possible public interest is served by allowing investment firms to violate our securities laws? It is now apparent that the public is being damaged by billions and billions of dollars, by permissions to give commission kickbacks, permission to sell tainted investments, permission to do just about anything an investment firm might wish to do. Can we please now find out what public interest is served, now that it is apparent that your government might be financially and legally liable for those billions of damages?

6. Is the Finance Minister prepared to face class actions against the Alberta Government for allowing its financial regulator to play loose with the Alberta Securities Act for the benefit of friends inside the industry?

7. What action will it take?

8. Having given two case studies to Iris Evans months ago, which clearly demonstrate the damages to Albertans, will Mrs. Evans be choosing to answer the correspondence or will she continue to ignore?

The investment professionals at www.investoradvocates.ca as well as the investing public are interested in your responses to these questions. Please direct your responses to investoradvocate@shaw.ca.
The general public can sign petition on securities regulation at http://www.PetitionOnline.com/rgh963/
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Re: Royal Commission or Judicial Inquiry

Postby admin » Mon Dec 15, 2008 11:11 pm

go to this site and sign the online petition if you care at all about proper securities regulation in Canada

"Canadian National Securities Regulatory System "

hosted on the web by our free online petition service, at:

http://www.PetitionOnline.com/rgh963/

if we do not change the system we have, we will keep getting the crooked results we are getting.

Please take the time to make this effort, on behalf of each and every Canadian, your sons, daughters etc.

The investment industry has completely taken over the regulatory system (if that is not already obvious) and they are powerful enough to spend hundreds of millions of dollars to tell you that all is well, that nothing need change.

Please help to be the change Canada needs in the area of how your and my retirement is funded or stolen a few percent at a time.
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Re: Royal Commission or Judicial Inquiry

Postby admin » Wed Dec 10, 2008 10:58 pm

An Open Letter to Finance Minister Iris Evans,

Now that the Alberta Securities Commission (ASC) has allowed knowingly tainted investments to be sold in Alberta, investments that did not meet our securities laws, this action has apparently made the Alberta government liable for millions of dollars of investment losses.

The City of Lethbridge, University of Calgary, Alberta Treasury Branches, as well as hundreds of unsuspecting individual investors were sold this tainted product.
The insidious part is how the vendors and the ASC knew beforehand that the product did not meet our securities laws, and yet they worked together, behind closed doors, to the benefit of the vendors, and the detriment of the public. They made adjustments, amendments or exemptions to our laws to allow them to be sold to the public without warning.

Will your government act on allegations of dysfunction (or worse) at the Alberta Securities Commission by convening a public inquiry under the Provincial Inquiries Act? This would serve to reassure Alberta citizens that our financial regulatory system works for them. Or will we have another session where the Alberta government covers for the Securities Commission, which is covering for friends in the industry, which is covering crimes against the public………..? This is institutionalized crime at its best.

I have supplied your office with documents including two case studies where the securities commission aided and abetted the violation of our Securities Act to benefit investment firms. I am aware of thousands of similar circumstances, but the case studies I provided to you are the “poster child” examples of a broken regulatory system. I would like them to form the basis of a public inquiry. They contain examples of nearly all that can go wrong when a regulatory system appears to become bought or captured. They include millions upon millions of dollars in damages to your voters here in Alberta. Most of these damages the public may never find out about unless you take some action.

For the benefit of the public, here are some of the reasons to convene an inquiry and to take action to ensure our financial system is not captured or corrupted at the provincial level.

First, the fundamental misrepresentation that the city may have relied upon, was that these investments were sold by a licensed professional investment advisor. Secondly they may or may not have been led to believe that the investments were as good as cash. Many other clients were told something to this effect to assure them before buying.

On the first point, one only has to look up the license and registration category of all those employed by the National Bank, were the product came from. (ASC web site) It is quickly discovered that the license and registration category of the persons who sold this product to the city is not, “advisor”, as advertised by this firm, but is instead that of “salesperson”, which is a separate and distinct registration category. As separate and distinct as the difference between calling myself a “doctor” if I were licensed as a pharmaceutical sales representative. (Advisor requires years of study to attain, salesperson takes 90 days. You can become a financial “salesperson” faster than you could be licensed as a hairdresser in Alberta)

This may be the first misrepresentation that should allow the city to show they were misled. I know that a bad product purchased by any other profession with such misleading sales tactics would carry some responsibility for this misrepresentation. They purchased in good faith, and the representations of the vendor should be honored by that vendor. This was not a “buyer beware” or a “back alley” transaction from my understanding of it. This was a relationship where a professional duty of care was promised and advertised by the firm and then simply not delivered upon.

In dealing with other levels of regulators and government, I have run into too many examples of “protect your job”, rather than “protect the public”. I hope that we do not find this at our local level, nor at your provincial level.

On the topic of protect ones job, whose job should it be to keep toxic investments out of the hands of consumers? Supposedly it is the responsibility of the Alberta Securities Commission, (ASC) our crown corporation charged with protecting the public interest. Strange then, to learn that it was our own ASC who assisted the sale of this known toxic investment, by granting permissions to skirt the law when selling these. Imagine living in a country where we have laws to protect the public, and the policing system becomes captured to the point where thousands upon thousands of times, these laws can be skirted, by a certain class of people, simply for the cost of an application fee. No notice to investors, no input from the public.

I cannot get a free pass to rob a bank, but if a bank wishes to rob the public…………

I must repeat for clarity, “many ABCP products did not meet our securities laws, and were only able to be sold by temporarily “exempting” these laws”. That makes the Alberta government liable, and hopefully Iris Evans, you will act accordingly on this information. You have had this information in your possession for more than two months now, without response. Unfortunately persons in a position of authority often find it in their best interest to “protect ones job”, rather than “protect the public”. Your predecessor Shirley McClellan did not act when presented with ASC corruption a couple of years back. She allowed the ASC to investigate themselves, and they gave her a very good report. On themselves. Which she accepted. Please do not do this to us Iris Evans.

The intentional introduction of this tainted product by way of legal tricks is an avenue that should trigger a full refund and an apology from the firm that sold this product. It is not the consumer’s fault if a toxic product enters the marketplace with the knowledge of the seller, the help of the regulator, and key information hidden from the consumer.

We now sit with approximately 30 million dollars that is totally unavailable to the city. We may see some, all or none of it in 2016. $30 million that was invested in a short-term product that was to be in a cash, or a near-cash position. All of it is unavailable to us now. All we have to show for $30 million is a further promise of something down the road. A promise from the same folks who sold it in the first place.

I ask you Iris Evans to immediately convene a public inquiry into the many factors which caused this, specifically the failures of our financial regulatory system to protect the interests of the public. Anything less will be a whitewash, a cover-up, and it will happen on your watch. We already did that two years ago with Shirley McClellan. Can we please choose serving and protecting the public this time around?

Larry Elford
My contact is aworks@shaw.ca if the city would like assistance, and or others would like to cooperate to help to recover money that belongs to the city of Lethbridge. If you would like to join in asking for a public inquiry into this matter, send me an e-mail in support of this, along with your contact info and I will make sure it gets to the Alberta legislature.

Larry Elford is a former CFP, CIM, FCSI, Associate Portfolio Manager, now retired. He works as an advocate to investors who have suffered abuse and loss from his former industry, and a private lobbyist for positive change in the public interest. His web flog can be found at www.investoradvocates.ca
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Re: Royal Commission or Judicial Inquiry

Postby admin » Sat Nov 29, 2008 10:40 pm

press release

Ontario to question OSC chairman on tuesday in Queens Park

One step removed from a public inquiry. Public inquiry being sought in Alberta, BC, Sask, and Ontario into failure by securities commissions to protect the public interest, resulting in damages and losses of billions upon billions of dollars to Canadian investors. Resulting in billions gained by financial and investment firms who have unique privileged access to these securities commissions.

Case studies are being presented that demonstrate clear and concise examples of favoritism towards the financial industry at the expense of the public interest. Favoritism which goes beyond the Securities Act, and possibly beyond he Criminal Code. It is expected and hoped that one or more of the thirteen provinces and territories will step forward and investigate allegations of wrongdoing by these agencies.

www.investoradvocates.ca web flogg for industry experts working in the public interest
www.investorvoice.ca top web site catalogue of regulatory failures


The CBC News: Sunday Night "Who's watching your money?" is now on the Internet at the following webpage. It was broadcast on Sunday, November 23, 2008 at 9 pm EST on CBC Newsworld and 10 pm EST on CBC-TV. The show will be rebroadcast on Sunday, November 30, 2008 at 9 am EST on CBC Newsworld and 10 am EST on CBC-TV.
http://www.cbc.ca/sunday/2008/11/112308_8.html

David Wilson, Chairman of the Ontario Securities Commission, is interviewed on this show. There is a comment section at this CBC webpage that gives feedback from Canadians on the need for improved securities regulation enforcement at the Ontario Securities Commission.

The Ontario Government Agencies Committee is reviewing the performance of the Ontario Securities Commission on Tuesday, December 2, 2008. David Wilson will be speaking and answering questions on behalf of the Ontario Securities Commission at this meeting, which is open to the public and media.

http://www.ontla.on.ca/web/committee-pr ... =en&ID=142

STANDING COMMITTEE ON GOVERNMENT AGENCIES

AGENDA

Tuesday, December 2, 2008

Committee Room 151

8:30 a.m.

Closed session

1. Report of the Sub-committee on Committee Business dated Thursday, November 27, 2008

2. Agency Review

1. Briefing by the Research Officer

9:00 a.m.

Open session

2. Ontario Securities Commission

David W. Wilson, Chair

Committee Members
Chair
Julia Munro
PC / York--Simcoe
Vice-Chair
Lisa MacLeod
PC / Nepean--Carleton
Members
Michael Brown
LIB / Algoma--Manitoulin
Kevin Flynn
LIB / Oakville
France Gélinas
NDP / Nickel Belt
Randy Hillier
PC / Lanark--Frontenac--Lennox and Addington
David Ramsay
LIB / Timiskaming--Cochrane
Liz Sandals
LIB / Guelph
Maria Van Bommel
LIB / Lambton--Kent--Middlesex
Clerk
Douglas Arnott

douglas_arnott@ontla.ola.org


thanks to Diane Urquhart for making much of this step possible.
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Re: Royal Commission or Judicial Inquiry

Postby admin » Sat Nov 29, 2008 1:24 pm

WWW.INVESTORADVOCATES.CA FOR IMMEDIATE RELEASE

Contact: Larry Elford, (former CFP, CIM, FCSI, Associate Portfolio Manager, retired)
403 328-0391 Lelford@shaw.ca Lethbridge Alberta

FINANCIAL CRISIS ALLOWED INTO CANADA
BY 13 PROVINCIAL AND TERRITORIAL SECURITIES COMMISSIONS

PROVINCIAL INQUIRY SOUGHT TO ASK COMMISSIONS TO JUSTIFY THE PUBLIC INTEREST REASONS FOR ALLOWING TAINTED INVESTMENTS THAT BROKE CANADIAN SECURITIES LAW

Investment experts from investoradvocates.ca, are seeking a public inquiry into legal exemptions (permissions granted to violate securities laws) granted by the thousands to investment firms in Canada.

These legal exemptions were and are granted to investment firms who are selling investments without public input to the purchasers of same, nor public input on the matter. While there have been thousands of such permissions to violate our laws, investoradvocates.ca is asking for public inquiry to find answers to the question, “what public interest is served in allowing investment firms to skirt our laws”?

Two case studies, which included or were triggered by the granting of legal exemptions by our securities commissions are being entered into the public record in each province being asked for inquiry. It is hoped that they will provide dramatic example of the damage that can be done by having our regulators allow investment companies to evade our laws.

One case study reveals details behind a commission kickback (commission rebating) scheme that was allowed and approved by our securities commissions, and which led to the alleged abuse of the public, and subsequent $800 million sale of the investment firm involved.

The second case study placed on the public record shows how three legal exemptions were granted to violate our protective laws, and this resulted in the current financial crisis of tainted, defaulted and much publicized Asset Backed Commercial Paper. The largest bankruptcy in Canadian history. To date, the management of this restructuring of this largest bankruptcy is being headed by a private lawyer whose background includes negotiating a “sweetheart deal”, and “get out of jail passes” for former executives of Imperial Tobacco, accused and convicted of cigarette smuggling in 2007. Why?

Where are the financial authorities in this matter? What did these financial authorities do to assist in causing this financial crisis? Why did they allow our laws to be violated?

Investoradvocates.ca feels that it is imperative that systemic foundational causes of financial abuse and predatory financial practices against Canadians must be investigated. Investoradvocates.ca feels it of importance equal to issues of tainted meat, tainted water, tainted blood, or tainted liberals.

Investoradvocates.ca represents approximately 1000 ethical investment professionals who feel that the financial industry and its regulators are failing to act in a professional manner befitting the importance to our Canadian economy. The case studies submitted to each legislature are intended to illustrate and support this.

If you would like further information, please call Larry Elford, Executive Director of investoradvocates.ca .
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Re: Royal Commission or Judicial Inquiry

Postby admin » Sat Nov 29, 2008 1:23 pm

www.investoradvocates.ca

Financial Crisis Press Release Oct 17, 2008

“The person who gave financial firms permission to break our securities laws and sell substandard financial investments to the public.”

“Is now employed at a self-regulatory agency and is pointing the finger at firms who sold these products.”

“She is the same person who signed the very documents granting legal exemption to these security laws.”

My name is Larry Elford. I am not making this up. Read on.
This release contains one Globe and Mail article, plus one comment at the end, and you will have the story.

http://www.theglobeandmail.com/servlet/ ... iness/home

Regulator says brokers failed on ABCP, sets new guidelines
JANET MCFARLAND
Globe and Mail Update
October 17, 2008 at 7:21 PM EDT
Canadian brokerage firms did little to review asset-backed commercial paper products before selling them to retail investors, according to a report by Canada's brokerage industry regulator.
The Investment Industry Regulatory Organization of Canada (IIROC) reported yesterday on a year-long compliance sweep of firms involved in selling non-bank ABCP to Canadian investors, laying out new guidelines to change the way investment firms review products before selling them to clients.
"There was very little understanding, generally speaking, of what this product really was all about," IIROC chief executive officer Susan Wolburgh Jenah said yesterday. She said brokerage firms reported they saw non-bank ABCP as little different from traditional commercial paper, even though IIROC concluded there were major risk differences.
The review concluded 76 per cent of the assets underlying non-bank ABCP were complex financial derivatives like synthetic collateralized debt obligations, whereas bank-sponsored ABCP had only three per cent of those types of derivatives and had 97 per cent traditional commercial paper assets like credit-card receivables. "The name asset-backed commercial paper was a misnomer. They were liability-backed," Ms. Wolburgh Jenah said.
The non-bank ABCP market collapsed in August, 2007, leaving investors holding about $35-billion of frozen notes, including 2,542 individuals with investments totalling $317-million. Many individuals were seniors or other risk-averse investors who reported they were assured ABCP was as safe as a bank GIC or other guaranteed product.
The report said none of the 21 Canadian brokerage firms that sold third-party ABCP to clients had reviewed the product through their internal due diligence process. Under such a process, committees assess whether new products are suitable for a firm to sell to corporate or retail clients.
IIROC said most firms reported they did not do due diligence reviews because they relied on the high credit rating the ABCP notes received from DBRS. Industry participants also reported they felt ABCP was a typical money market instrument that did not require risk assessment.
Bank-owned brokerage firms relied on reviews by their parent banks, the report added, but most of the reviews were done to establish credit and trading limits as part of financial risk control. Only one unidentified bank reviewed the product from a client suitability perspective and decided not to sell it. Toronto-Dominion Bank has previously disclosed it did not sell ABCP to clients.
IIROC said member firms that did not sell ABCP to clients reported they did not believe their clients would understand the product, or that there were simpler alternative products, or that there was little profit on the transactions. Indeed, the report said all dealer members who sold ABCP to retail investors reported the product was viewed as a "loss-leader" service to clients and not a profitable product.
No firms or brokers have been sanctioned by IIROC for selling ABCP to clients for whom it was not a suitable investment under the industry's know-your-client rules. Ms. Wolburgh Jenah said IIROC has not completed its reviews of complaints from clients.

Below is the comment from www.investoradvocates.ca :

(larry elford, from lethbridge alberta, Canada) wrote: Fascinating to see Ms. Wolburgh Jenah point the finger at Canadian Investment firms........."Canadian brokerage firms did little to review asset-backed commercial paper products before selling them to retail investors, according to a report by Canada's brokerage industry regulator"

I have in my hands two "exemptive relief" documents, signed by Ms. Wolburgh Jenah when she was vice chair of the Ontario Securities Commission. These permissions allowed major banks in Canada to sell these products to consumers without meeting our securities laws.

Perhaps it would be time for her to come forward, and explain why she granted these firms permission to break our laws with these products.

(see permissions to break our laws signed by Susan Wolbergh Jenah at:
http://www.osc.gov.on.ca/Regulation/Ord ... tdbank.jsp
and
http://www.osc.gov.on.ca/Regulation/Ord ... ntreal.jsp

By checking the OSC web page under orders, rulings and decisions, one can find several thousand permissions to break our laws granted by her or her colleagues at the securities commissions. A commission of inquiry is requested by investment professionals at investoradvocates.ca who find our financial laws a cruel joke at best, and criminal breach of trust at worst.

See www.investoradvocates.ca for a move toward bringing to justice some of the perpetrators of these cruel, clever, and cunning tricks upon the public.
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Postby admin » Wed Nov 12, 2008 9:18 am

WWW.INVESTORADVOCATES.CA FOR IMMEDIATE RELEASE NOVEMBER 11, 2008

Contact: Larry Elford, (former CFP, CIM, FCSI, Associate Portfolio Manager, retired)


FINANCIAL CRISIS ALLOWED INTO CANADA BY 13 PROVINCIAL AND TERRITORIAL SECURITIES COMMISSIONS

PROVINCIAL INQUIRY SOUGHT TO ASK COMMISSIONS TO JUSTIFY THE PUBLIC INTEREST REASONS FOR ALLOWING TAINTED INVESTMENTS THAT BROKE CANADIAN SECURITIES LAW


Investment experts from investoradvocates.ca, are seeking a public inquiry into legal exemptions (permissions granted to violate securities laws) granted by the thousands to investment firms in Canada.


These legal exemptions were granted to investment firms without public notice to the purchasers of the investments, nor public input on the decision to skirt our laws. While there have been thousands of such permissions to violate our laws, investoradvocates.ca is asking for public inquiry to find answers to the question, “what public interest is served in allowing investment firms to skirt our laws”?


Two case studies which included legal exemptions by securities commissions are being entered into the public record. They illustrate in striking clarity the damage that can be done when our regulators allow investment companies to evade our laws.

One case study reveals details behind a commission kickback (commission rebating) scheme that was allowed and approved by our securities commissions, and which led to abuse of the public, and subsequent $800 million sale of the investment firm.


The second case study placed on the public record shows legal exemptions were granted to violate our protective laws, and this resulted in the current financial crisis of tainted, defaulted and much publicized Asset Backed Commercial Paper. The largest bankruptcy in Canadian history. The restructuring of this bankruptcy is being headed by a private lawyer whose background includes negotiating a “sweetheart deal”, and “get out of jail passes” for former executives of Imperial Tobacco, accused and convicted of cigarette smuggling in 2007. Why this man?


Where are the financial authorities in this matter?
What did these financial authorities do to assist in causing this financial crisis?
Why are they avoiding involvement at this stage of crisis?
Why did they allow our laws to be violated?


Investoradvocates.ca feels that it is imperative that systemic causes of financial abuse against Canadians be investigated. We feel it of equal importance to issues such as tainted meat, tainted water, tainted blood, or tainted liberals.


Investoradvocates.ca represents approximately 1000 ethical investment professionals who feel that the financial industry and its regulators are failing to act in a professional manner befitting the importance to our Canadian economy. The case studies submitted to each legislature are intended to illustrate and support this.

(Regardless of any public inquiry request, it is assumed and expected that the people who remain financially damaged by the ABCP product in case study #2 MUST receive complete and total compensation immediately, if not sooner. Either than or there should be people going to jail in Canada for selling and allowing the sale of these products to the public.)
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Postby admin » Sat Oct 18, 2008 1:04 pm

JANET MCFARLAND

Globe and Mail Update

October 17, 2008 at 7:21 PM EDT

Canadian brokerage firms did little to review asset-backed commercial paper products before selling them to retail investors, according to a report by Canada's brokerage industry regulator.

The Investment Industry Regulatory Organization of Canada (IIROC) reported yesterday on a year-long compliance sweep of firms involved in selling non-bank ABCP to Canadian investors, laying out new guidelines to change the way investment firms review products before selling them to clients.

"There was very little understanding, generally speaking, of what this product really was all about," IIROC chief executive officer Susan Wolburgh Jenah said yesterday. She said brokerage firms reported they saw non-bank ABCP as little different from traditional commercial paper, even though IIROC concluded there were major risk differences.

The review concluded 76 per cent of the assets underlying non-bank ABCP were complex financial derivatives like synthetic collateralized debt obligations, whereas bank-sponsored ABCP had only three per cent of those types of derivatives and had 97 per cent traditional commercial paper assets like credit-card receivables. "The name asset-backed commercial paper was a misnomer. They were liability-backed," Ms. Wolburgh Jenah said.

The non-bank ABCP market collapsed in August, 2007, leaving investors holding about $35-billion of frozen notes, including 2,542 individuals with investments totalling $317-million. Many individuals were seniors or other risk-averse investors who reported they were assured ABCP was as safe as a bank GIC or other guaranteed product.
The report said none of the 21 Canadian brokerage firms that sold third-party ABCP to clients had reviewed the product through their internal due diligence process. Under such a process, committees assess whether new products are suitable for a firm to sell to corporate or retail clients.

IIROC said most firms reported they did not do due diligence reviews because they relied on the high credit rating the ABCP notes received from DBRS. Industry participants also reported they felt ABCP was a typical money market instrument that did not require risk assessment.

Bank-owned brokerage firms relied on reviews by their parent banks, the report added, but most of the reviews were done to establish credit and trading limits as part of financial risk control. Only one unidentified bank reviewed the product from a client suitability perspective and decided not to sell it. Toronto-Dominion Bank has previously disclosed it did not sell ABCP to clients.

IIROC said member firms that did not sell ABCP to clients reported they did not believe their clients would understand the product, or that there were simpler alternative products, or that there was little profit on the transactions. Indeed, the report said all dealer members who sold ABCP to retail investors reported the product was viewed as a "loss-leader" service to clients and not a profitable product.

No firms or brokers have been sanctioned by IIROC for selling ABCP to clients for whom it was not a suitable investment under the industry's know-your-client rules. Ms. Wolburgh Jenah said IIROC has not completed its reviews of complaints from clients.
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Postby admin » Fri Oct 17, 2008 8:14 pm

re an article in the globe and mail to be posted in next reply

fascinating to see Ms. Wolburgh Jenah point the finger at Canadian Investment firms........."Canadian brokerage firms did little to review asset-backed commercial paper products before selling them to retail investors, according to a report by Canada's brokerage industry regulator" (JANET MCFARLAND
Globe and Mail Update
October 17, 2008)

I have in my hands two "exemptive relief" documents, signed by Ms. Wolburgh Jenah herself when she was vice chair of the Ontario Securities Commission. These permissions slips allowed major banks in Canada to sell these products to consumers without meeting our securities laws, which Ms. Wolbergh Jenah was charged with enforcing.

Perhaps it would be time for her to come forward, and explain why she granted these firms permission to break our laws with these products.

Possibly she has forgotten all about it. After all. By checking the OSC web page under orders, rulings and decisions, one can find several thousand similar permissions to break our laws granted by her and her colleagues at the securities commissions. http://www.osc.gov.on.ca/Regulation/Ord ... _index.jsp

A commission of inquiry is requested by investment professionals who find our financial laws a cruel joke at best, and criminal breach of trust at worst.

See www.investoradvocates.ca for a move toward brining to justice some of the perpetrators of these cruel, clever, and cunning tricks upon the public. I refer not only to the folks who sold them, but also to the regulators who gave permission to these folks to break our securities laws.
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Financial Crimes Tribunal

Postby admin » Tue Oct 14, 2008 12:37 pm

The most interesting thing I heard this thanksgiving weekend, was from some financial experts who were talking about "financial crimes trials".

It was suggested that once the full measure of damage from this current financial crisis is understood, that there might be a hue and cry to hold some of those who caused it responsible.

investoradvocates.ca has calculated an annual damage to the public amount from predatory financial practices in Canada alone at more than the cost of "every property crime in Canada".

It is hoped that the average consumer will be able to grasp this at some point, and when they do, we might make some progress towards demanding accountability.
We also look forward to using proceeds of crime legislation to remove some of the ill gotten gains from top executives who may have raped their own companies in order to enrich themselves.

But first step is always the investigation, before criminal charges can proceed, so the judicial inquiry, in public, is what our leaders need to embark upon to get started. As today is election day, who knows how that will go. I personally feel that Canada is waiting for a financial hero, and the job is wide open to any one of them.
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Postby admin » Fri Oct 10, 2008 8:33 am

the public appears to get it, while the media and the leaders still are not awake.................

the public is acting out of fear and mistrust, while leaders are trying to calm and reasure with words.

Let me respectfully suggest what might be needed before this crisis comes to and end.

We may need to hold an investigation, a public inquiry into the root causes that allowed this crisis to start.

When we crash an airplane we hold investigation. When we have tainted blood in our health care system we have a Royal Commission.
Even tainted meat is recalled and the underlying causes rooted out and cleaned up. It is only in financial baloney that tainted product can be sold without recall, without recourse and without investigation. Why?

Why are major financial institutions who sold this stuff not asked why they asked for permission to break our laws to sell it in our country?

Why are our securities commissions not asked why they gave permission to their friends to break our laws to sell this stuff?

Investoradvocates.ca has copies of the permission slips given to these firms to break the law and sell this stuff. Where is the investigation into this largest crash in Canada's history? What if our financial institutions and regulators were partially to blame? Will they investigate themselves?
Last edited by admin on Thu Nov 13, 2008 1:49 pm, edited 1 time in total.
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