Broker/Advisor Disguise and Deception

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Re: Broker/Advisor Disguise and Deception

Postby admin » Thu Jan 28, 2021 5:17 pm ... cts-202071

Fiduciary advocates urge SEC to rename Reg BI, eliminate broker conflicts

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January 28, 2021 By Mark Schoeff Jr.

In addition changing Reg BI's nomenclature, the Institute for the Fiduciary Standard called for eliminating some broker conflicts of interest, such as compensation incentives for product sales, revising the disclosure Form CRS and clarifying that investment advisers must avoid conflicts of interest rather than just disclosing them.

The Securities and Exchange Commission should rename Regulation Best Interest so investors aren’t confused about the difference between investment advisers providing fiduciary advance and a broker selling an investment product,
fiduciary advocates said Thursday.

The Institute for the Fiduciary Standard released several recommendations to revise the broker advice standard, which went into force last summer, and related advice reform.

In addition to changing the name of Reg BI, it called for eliminating some broker conflicts of interest, such as compensation incentives for product sales, revising the disclosure Form CRS, and clarifying that investment advisers must avoid conflicts of interest rather than just disclosing them.

The “best interest” term in Reg BI misleads investors because it’s the same phrase that is at the heart of the fiduciary duty that continues to govern investment advisers, fiduciary advocates said. Instead, Reg BI should be called “New Suitability,” which refers to the previous broker standard.

“Broker-dealers are designed and built to represent issuers and other sellers,”
Knut Rostad, president of the Institute for the Fiduciary Standard, told reporters on a conference call.
“Broker-dealers cannot meet a best interest fiduciary standard.”

But that’s what Reg BI implies, Brian Hamburger, chief executive of MarketCounsel Consulting, said on the call.
“We have to level with investors, that’s at the crux of all of this.”

Reg BI was the signature rulemaking of former SEC Chairman Jay Clayton, who said the regulation raised the broker standard well above suitability and strengthened investor protection. The brokerage industry also strongly supports Reg BI, maintaining that it requires substantial changes in the way brokers provide advice and disclose conflicts.

Critics say Reg BI appropriated the “best interest” phrase but not the related standard of care.

“Regulation Best Interest by its very name is likely the greatest securities fraud in the history of the SEC,”
Ron Rhoades, associate professor of finance at Western Kentucky University, said on the call. “There needs to be a new rule to, at a minimum, remove the term ‘best interest’ from describing a broker-dealer standard of conduct.”

It’s unclear whether the incoming Democratic-majority SEC will undertake a rulemaking to overturn Reg BI or will try to strengthen it through guidance and enforcement.

Rostad is confident the institute’s Reg BI recommendations will be taken seriously by Gary Gensler, a former chairman of the Commodity Futures Trading Commission and former Wall Street executive, who has been nominated to serve as SEC chairman by President Joe Biden. Gensler previously headed the Maryland Consumer Financial Protection Commission, which promoted legislation that would impose a fiduciary standard for investment advice in the state.

Rostad said much of the Reg BI reform will have to be done through rulemaking.

“We’ve got every reason to believe he’ll be open-minded about the nature of these changes,” Rostad said. “We have reason to believe he’s sympathetic with what we’re talking about.”

Hamburger is doubtful that the SEC will reform Reg BI on its own.

The Dodd-Frank financial reform law included a provision that said the SEC could only change the broker advice standard if it made it “no less stringent” than the advice standard that investment advisers must meet. A lawsuit to strike down Reg BI failed when a federal appeals court ruled the SEC did not violate the Dodd-Frank law in promulgating the regulation.

Hamburger said Congress — where Democrats have narrow majorities in the House and Senate — should step in and legislate a tougher broker standard.

“Congress has spoken,” Hamburger said. “The most effective way that we can get back on track here is for Congress to speak again — is for Congress to insist that the SEC act in compliance with the law.”

That will cause a heavy regulatory lift for the SEC.

“Practically speaking, this would require the SEC to amend the rules,” Hamburger said. “But I will tell you, interpretative guidance is not going to do it here. The SEC, at a minimum, has to amend these rules to ensure we have a very clear standard and practices across the industry.”

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Re: Broker/Advisor Disguise and Deception

Postby admin » Tue Dec 08, 2020 10:45 am

Topics this article is about:

1. Do you have a salesperson in disguise, or a professional advice giver?

2. Do they have years of training and a fiduciary duty, or a typical 90 day sales training course and sales-job role?

3. Do they have a written duty to protect the customer and provide best interest advice, or verbal promises which help conceal their true agency-duty to meet bank product sales or asset gathering quotas?

4. The public is placed at great financial risk when #FFA’s (Falsified Financial Advisors) are able to spin public perception into a false confidence in a false “professional”.

5. Do they themselves fund their own regulatory agency? When regulators become complicit in this it is a breach of the public trust and an abuse of public entrusted power. #Corruption ... ls-titles/

No one wins if current rules for financial professionals’ titles remain as is

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Financial professionals’ titles in any province other than Quebec are borderline meaningless due to lack of standardization and qualifications. Ontario’s provincial government aimed to rectify that when it passed the Financial Professionals Title Protection Act, 2019.

Recent efforts from the Ontario government to ensure that only financial professionals with appropriate credentials be able to call themselves “financial planners” or “financial advisors” are being met with resistance from financial services industry associations lobbying to maintain the status quo. If this self-serving push is victorious, it will only benefit the least-qualified providers of financial services and be another setback for professionalization and transparency in the investment industry.

Currently, financial professionals’ titles in any province other than Quebec are borderline meaningless due to lack of standardization and qualifications. These titles do nothing to inform consumers of financial services as to what the financial professional they deal with actually does. Worse yet, these titles give the person providing the service a level of credibility that may be completely unearned and unwarranted.

The provincial government in Ontario – home to the largest population of financial professionals in the country – aimed to rectify all of that when it passed the Financial Professionals Title Protection Act, 2019. (The legislation received Royal Assent in May 2019.) Since then, the Ontario government has entrusted the province’s newest financial services regulator, the Financial Services Regulatory Authority of Ontario (FSRA), to oversee the implementation of the law. Public consultations on the draft regulationsclosed on Nov. 12.

The proposed regulations would limit the use of the title “financial planner” or “financial advisor” only to financial professionals who hold a qualifying credential. Ontario’s goal is to review the available credentials – such as the certified financial planner and the chartered investment manager – to determine which ones qualify for either title. This will be a substantial improvement from where things stand today, in which anyone can call themselves anything they want.

There are many positive submissions to the public consultations. For example, various investor groups and advocates have argued the proposed rules don’t go far enough because they don’t impose a fiduciary standard. Many have even provided constructive feedback on how the FSRA can make the most of this legislation.

In contrast, some industry associations’ submissions are nothing more than a self-interested preservation of the status quo.
They say Ontario’s proposed rules set the bar too high because they would exclude some people who are using either title now from continuing to do so without achieving further designations or credentials.

For example, the proposed rules say that someone who has achieved a licence to sell life insurance products – and no further designations or training – would not qualify to use either the financial planner or financial advisor title. In response, the Canadian Life and Health Insurance Association Inc. (CLHIA) and various insurance-centric organizations argue that the existing insurance sales training “meets or exceeds the baseline competency of someone who calls themselves a ‘financial advisor,’” and, as a result, no further qualifications should be required.

Similarly, the Investment Industry Association of Canada (IIAC) argued in its submission on the proposed rules that financial professionals who are regulated by either the Mutual Funds Dealers Association of Canada (MFDA) or the Investment Industry Regulatory Association of Canada (IIROC) should be exempt from any requirement to obtain further credentials or training before using the financial advisor title.

In both cases, the argument is that the existing qualifications are sufficient to merit the use of the financial advisor title and that requiring further training would pose an “undue regulatory burden” on financial professionals. The problem with this approach is that IIROC or MFDA licensing provides people the level of understanding required to sell a product. However, financial advice and financial planning are not focused narrowly on product sales. In fact, they may result in no product sales whatsoever.

Instead, financial planners or financial advisors synthesize information to make well-educated, informed recommendations. Product selection and sales are only a tiny fraction of financial planners’ or financial advisors’ process and are only made after information-gathering, analysis, and synthesis to ensure the right fit.

The FSRA has already singled out the course that qualifies someone to sell insurance in Ontario as falling short of the standard required for the financial planner title. The course leading to MFDA licensing similarly falls short of that standard. In fact, Jason Watt, a full-time instructor at the Business Career College, a financial services course provider that’s recognized nationally, says “the mutual fund licensing course represents a bar of proficiency no better, if not lower, than the standard set by the life insurance sales training course.”

If the submissions from the CHLIA, the IIAC and others pushing for the status quo are accepted, title reform in Ontario won’t amount to anything more than rubber-stamping the entire financial services industry as-is – turning this entire exercise into a perfect example of regulatory capture.

The winners of title regulation will be the least-educated and least-qualified members of the industry – and the companies that rely upon them for sales revenue. Everyone else – especially consumers of financial services, educated and credentialled financial planners and financial advisors, and the entire financial services industry in Ontario – will lose.

Millennials and members of Generation Z already distrust financial services institutions and are looking at digital alternatives like robo-advisors. Turning title reform into a farce is just one more reason for them to continue to shift away from traditional financial services providers altogether.

Jason Pereira is a partner and senior financial consultant at Woodgate Financial Inc., a financial planning firm under the IPC Securities Corp. umbrella in Toronto. ... ls-titles/
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Re: Broker/Advisor Disguise and Deception

Postby admin » Tue Nov 24, 2020 1:12 am

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Broker/Advisor Disguise and Deception

"Docter" "Doctor” and ”Doctur”. Nobody is fooled by spelling variations and/or pill seller promises in the medical business. (not yet, anyway...

But with “Broker”, “Advisor”, “Adviser”, almost everyone is fooled by sales brokers pretending to be SEC or state or Provincial (in Canada) registered “Advisers", just by calling themselves “Advisor”, which is a non-legal, non-professional title only. Only “Adviser” is found in Securities Acts, and yes, investment firm lawyers have no qualms about deceiving the public with a clever “vowel movement”.

Check for yourself with some helpful videos online. They are short, sweet, informative and helpful to anyone wanting to know the truth about whether they are in a buyer-beware, salesperson relationship, or a trusted professional fiduciary relationship. The difference could mean the difference between life and death to your investment returns.

Brokers and Investment Advisers - Know the Difference

Under three minutes, done by the SEC.

Broker or fiduciary video topic

search YouTube

here is a two minute version to get you started

There are at least another three-dozen videos on YouTube in the same broker or fiduciary topic. Watch them if the care and safety of your life savings is important. Get it in writing, rather than trust or "take the word” from any salesperson.

A few that I have viewed, are short, sweet and not nonsense, are also listed below:

Is the fiduciary rule dead? Here's everything you need to know, (under 3 minutes and good quality) 2018
(Fiduciary with fees as low as 1%)


Trajan Wealth | Jeff Junior | Fiduciary vs. Broker Under 2 minutes, conflicts of interest well explained:

Fee- Only Fiduciary vs Broker, under 3 minutes, well explained:

Many more found using the search topic "Broker or Fiduciary” Never let yourself be fooled by the person calling themselves an “Advisor”, there are over 100,000 such persons in Canada, most of whom do not hold the license nor registration for that self-claimed marketing title. See this SEC video on SEC registered “Advisers” (note the spelling using “er” at the end of adviser, and YES, it is often cleverly disguised by simple mis-spelling of the title to “fake” the title) Financial predators know few boundaries, and financial regulators are usually paid by, you guessed it…the brokerage industry.

Brokers and Investment Advisers - How They Get Paid
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Re: Broker/Advisor Disguise and Deception

Postby admin » Tue Mar 03, 2020 4:23 pm

What is the public to do when a broker holds “dual registration”?

When they have both an “Adviser”(fiduciary advice) and a “broker” (sales) license?

How is the client supposed to know when their life savings or investments are being served with the broker standard of sales and suitability, or the Adviser standard of fiduciary advice.

What a clever trick to have in ones pocket if wanting to bait and switch investors...bait them with the promise of a fiduciary Adviser, and then switch hats to the sales broker when wanting to make some additional money....

Here is one example of a million....

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Dually Registered Firm Penalized for 12b-1 Fee Infractions
BPU Investment Management purchased, recommended or held mutual fund share classes that charged 12b-1 fees instead of lower-cost ones.

By Melanie Waddell | February 19, 2020 at 04:02 PM

A dually registered firm has been ordered to pay more than $927,000 for breaching its fiduciary duty by collecting 12b-1 fees on mutual fund share classes when lower cost funds were available.

BPU Investment Management, Inc., a dually registered investment advisor (mis=spelled “Advisor”, see FINRA explanation at end of this article) and broker-dealer, was ordered on Feb. 13 to pay disgorgement, prejudgment interest, and a civil penalty totaling $927,107.

From December 2013 through May 2017 BPU purchased, recommended or held for advisory clients mutual fund share classes that charged 12b-1 fees instead of lower-cost share classes of the same funds that were available to the clients, according to the SEC order.

While BPU received 12b-1 fees in connection with the investments, the firm failed to adequately disclose this conflict of interest in its Forms ADV or otherwise, the order states.

Further, BPU failed to adopt and implement written compliance policies and procedures reasonably designed to prevent violations of the Advisers Act and the rules thereunder in connection with its mutual fund share class selection practices.

BPU, although eligible to do so, also did not self-report to the Commission pursuant to the Division of Enforcement’s Share Class Selection Disclosure Initiative.

James Lundy, partner in Faegre Drinker Biddle & Reath’s Chicago office, said the BPU case “appears to be one of the follow-up cases based on their [the SEC's] investigative efforts into firms who did not self-report, but that the SEC alleges qualified for the SCSDI.”

The agency also said BPU failed to seek best execution for its clients and failed to adopt and implement written policies and procedures reasonably designed to disclose conflicts of interest presented by its mutual fund share class selection practices.

Cipperman Compliance Services stated in a note on the action that “revenue sharing is dead. We don’t think an advisor could include enough disclosure to satisfy the SEC where the advisor recommends a share class more expensive that a comparable share class that does not result in adviser payola.”

The BPU case, Cipperman opined, is also “another example of the failed dual-hat Chief Compliance Officer model.”

BPU Investment Management, Inc., headquartered in Pittsburgh, has been registered with the Commission as an investment advisor since 2001 and as a broker-dealer since 1985.

In its Form ADV dated March 29, 2019, BPU reported that it had approximately $517 million in regulatory assets under management. ... 1ME7VOIDlM

re: advisor (mis=spelled “Advisor”, see FINRA explanation at end of this article)
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Investment Advisers
Although most people would use an "o," we purposely spell adviser with an "e" when we talk about investment advisers. That’s because the laws that govern this type of investment professional spell the title this way.

Many investment advisers are also brokers—but these two types of investment professional aren’t the same.
So as you choose among different professionals, here’s what you need to know about investment advisers.

What they are:
An investment adviser is an individual or company who is paid for providing advice about securities to their clients. Although the terms sound similar, investment advisers are not the same as financial advisors and should not be confused.
The term financial advisor is a generic term that usually refers to a broker (or, to use the technical term, a registered representative). By contrast, the term investment adviser is a legal term that refers to an individual or company that is registered as such with either the Securities and Exchange Commission or a state securities regulator. Common names for investment advisers include asset managers, investment counselors, investment managers, portfolio managers, and wealth managers. Investment adviser representatives are individuals who work for and give advice on behalf of registered investment advisers.

Who regulates them: The SEC regulates investment advisers who manage $110 million or more in client assets, while state securities regulators have jurisdiction over advisers who manage up to $100 million. Advisers with less than $100 million in assets under management (AUM) must register with the state regulator for the state where the adviser has its principal place of business. When a state-registered adviser’s AUM reach the $100 million threshold, the adviser may elect to register with the SEC—but when the adviser’s AUM exceeds $110 million, it generally must register with the SEC. It is important to find out exactly which services a professional who wears multiple hats will provide for you and what they will charge for their services. You can get background information on both SEC- and state-registered investment advisers by using FINRA BrokerCheck or calling us toll-free (800) 289-9999. You can also get background information by visiting the SEC's Investment Adviser Public Disclosure database.
What they offer: In addition to providing individually tailored investment advice, some investment advisers manage investment portfolios. Others may offer financial planning services or, if they are properly licensed, brokerage services (such as buying or selling stock or bonds)—or some combination of all these services. ... t-advisers
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Re: Broker/Advisor Disguise and Deception

Postby admin » Tue Nov 05, 2019 8:34 pm ... rmation-bc

Private Prosecution - Laying an Information in BC

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In British Columbia, any criminal proceeding that is not brought under s.577 of the Criminal Code is begun with the laying of an information (Form 2, Offence Act / Form 2, Criminal Code). Usually this form is laid by a law enforcement officer but it can also be laid by a member of the public.

This is sometimes known as a private prosecution and is used by the public to bring the court’s attention to criminal activity that they believe to be occurring. Once written, the information is taken before a judge and sworn under oath.

The only formal qualification for the laying of an information is a belief “on reasonable grounds” that the stated offence is occurring. This is covered in s.504 of the Criminal Code

Where can I find sample informations?

Sample forms can be recovered from a provincial court registry by providing them with the file number associated with a case. The filings (including the information that was laid) of each case can be recovered for a fee.

File numbers are most easily recorded by searching WestLawNext in a courthouse library for the Information form and then clicking the “citing references” tab.

Offence Act, RSBC 1996, c.338 - BC Laws
Criminal Code, RSC 1985, c. C-46 - Justice Laws
Form 2 - Information, Offence Act - BC Laws
Form 2 - Information, Criminal Code - Justice Laws
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Re: Broker/Advisor Disguise and Deception

Postby admin » Wed Jun 19, 2019 8:48 pm

Ron Rhoades says that when brokerage associations (i.e. FSI and SIFMA) and broker-dealers, like Morgan Stanley, offer threatening boycott comments in symphony, that they may very well break the law.
Broker-dealers' new power tactic -- threatening to quit states altogether -- to thwart local fiduciary rules for advisors sure looks like blatant misuse of power

SIFMA, FSI and Morgan Stanley made overt threats to Nevada and New Jersey and CFP Board that have more than a whiff of conspiracy to restrain trade

June 18, 2019 — by Guest Columnist Ron A. Rhoades

Brooke's Note: Desperate times call for even more desperate measures. Threats by Morgan Stanley and their cohorts and lobbyists to pick up their toys and go home if states seek to impose on them a higher standard of fiduciary care are not being made from strength. That said, they certainly are flexing their muscles -- perhaps illegally, according to Ron Rhoades, director of the personal financial planning program at Western Kentucky University. Still, it's hard to imagine that the brokerage industry holds many cards here. What if Nevada, New Jersey or Massachusetts calls their bluff and says, in effect, don't let the door hit you in your posterior on the way out? Some of those deactivated brokers might become RIAs or join a new brokerage firm with hardly a consumer complaint.

In early 2019 broker-dealer Morgan Stanley threatened to stop doing business in Nevada if the state securities division proceeded with plans to adopt a local fiduciary rule for financial advisers.

“Absent substantial changes to the proposal, Morgan Stanley will be unable to provide brokerage services to residents of the state of Nevada,”
said the Wall Street bank in a statement.

The New York City wirehouse is the nation's largest broker-dealer with about 15,500 brokers, advising about $2 trillion in assets. It has four branch offices in Nevada, including one each in Reno, Stateline and two in Las Vegas. It has 500 offices worldwide.

SIFMA's shoulder
Nearly contemporaneously, other firms, including Wells Fargo & Co., Charles Schwab & Co. Inc., and Edward D. Jones & Co. were reported to be considering terminating some of their own brokerage offerings in the state.

Morgan Stanley has warned that it might withdraw from this Las Vegas building and three other branches in Nevada.
Even the Securities and Financial Markets Association (SIFMA), one of two main broker-dealer lobbying associations, appeared to threaten Nevada, stating in its comment letter that some of its member firms might be compelled to “discontinue service to B-D accounts in Nevada.”

More recently, in its June 14 comment letter to the New Jersey Bureau of Securities, the Financial Services Institute (“FSI”), the other main broker-dealer lobbying organization, appeared to threaten that its members would cease doing business in the state, if New Jersey went through with its proposal to apply fiduciary standards.

Robin M. Traxler, FSI's senior vice president and deputy general counsel, stated in FSI’s comment letter:

“If FSI members are held to a unique standard of care ... these financial advisors may have to cease doing business with, or cut back on financial services provided to, retail investors in New Jersey. This would undoubtedly have a negative impact on New Jersey investors, particularly those [who are] low- to middle-income retail investors.”

Similarly, at least one broker-dealer recently wrote to the Certified Financial Planner (CFP) Board of Standards, Inc., to the effect that it and other broker-dealer firms, acting in coordination with their trade association, may meet and determine whether to require their registered representatives to surrender their CFP certifications should the CFP Board proceed to implement its fiduciary standard upon CFPs, effective Oct. 1 this year.

These actual or implied threats beg the question: Are broker-dealers conspiring, either with each other directly, or via their trade associations, to violate federal antitrust and/or trade practices laws?

Sherman Act
Section 1 of the Sherman Act states, “Every contract, combination… or conspiracy in restraint of trade or commerce… is declared to be illegal.”

Robin Traxler:
This would undoubtedly have a negative impact on New Jersey investors, particularly those [who are] low- to middle-income retail investors.”

Section 5 of the Federal Trade Commission (FTC) Act prohibits “unfair or deceptive acts or practices in or affecting commerce.”

Generally, group boycotts are generally impermissible under the law. As stated by the Federal Trade Commission:
“Any company may, on its own, refuse to do business with another firm, but an agreement among competitors not to do business with targeted individuals or businesses may be an illegal boycott, especially if the group of competitors working together has market power.”

The statements made to Nevada and New Jersey might be interpreted by some to imply that the broker-dealer firms seek to maintain the ability to sell investment securities and insurance products that pay its members higher levels of compensation than the compensation that might be available to them under a fiduciary standard (which generally prohibits compensation which is in excess of what is reasonable under the circumstances).

In prior judicial proceedings, similar threats have been held to be illegal. For example, the FTC successfully challenged the group boycott of an association of competing trial lawyers that stopped providing legal services to the District of Columbia for indigent criminal defendants until the District increased the fees it paid for those services.

The Supreme Court upheld the FTC’s ruling in FTC v. Superior Court Trial Lawyers Assn., 493 U.S. 411 (1990), stating that the “boycott constituted a classic restraint of trade within the meaning of Section 1 of the Sherman Act" and that “it also violated the prohibition against unfair methods of competition in 5 of the FTC Act.”

While the broker-dealer trade associations and their members may argue that they are only exercising their free speech rights, the U.S. Supreme Court may likely disagree, It has held that “every concerted effort that is genuinely intended to influence governmental action” is not protected from antitrust concerns.

'Horizontal conspiracies'

Indeed, the U.S. Supreme Court has stated: “Horizontal conspiracies or boycotts designed to exact higher prices or other economic advantages from the government would be immunized on the ground that they are genuinely intended to influence the government to agree to the conspirators' terms.” See: FTC v. Superior Court Trial Lawyers Assn., 493 U.S. 411 (1990).

U.S. Supreme Court Building
The Supreme Court has upheld the FTC's ban on boycotts that restrain trade. (Photo By Joe Ravi)
Trade associations, such as SIFMA and FSI, can serve important purposes. But they must be careful in their activities, especially if such activities would, as a result, restrain trade or serve to promote unfair trade practices.

Group boycotts of a state, or of a standards-setting organization such as the CFP Board of Standards, Inc., can and should face a high degree of scrutiny.

I urge the Federal Trade Commission, and the various state trade commissions, to explore the recent activities undertaken by broker-dealers and their trade associations as described above.

These regulatory bodies should examine the conduct to ascertain if the line – between broker-dealers (and their trade associations) providing information to government regulators or standards-setting bodies lawfully, versus engaging in actions that may serve to restrain trade – has been crossed.

Ron A. Rhoades serves as Director of the Personal Financial Planning Program at Western Kentucky University. This article reflects his own views, and are not those of his employer nor any firm, organization, institution, or cult to which he now or has ever belonged or been kicked out of.
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Re: Broker/Advisor Disguise and Deception

Postby admin » Fri Jun 14, 2019 12:07 pm

“For most Canadians, their experience with the financial planning industry does not involve actual financial planning at all. What it does include is a meeting with an individual who has a title that leads consumers to believe they are receiving financial planning advice. However, in reality consumers are dealing with financial salesperson who is employed by organizations to solicit a specific product or series of products.”

Screen Shot 2019-06-14 at 1.06.51 PM.png ... ar-enough/

At long last, the Ontario government is regulating who can use the titles of financial planner and financial advisor in the province.

The Financial Professionals Title Protection Act was passed earlier this month and the Ontario government is now working on regulations for implementing the law.

It’s hard to believe, but anyone can call themselves a financial planner or advisor and take clients in every province, except Quebec. There’s no need for any special education, training or qualifications to give potentially life-altering financial advice.

Often, the people using the title financial planner, or some other similar title, are actually investment salespeople, as is explained in a report by the Public Interest Advocacy Centre (PIAC).

“For most Canadians, their experience with the financial planning industry does not involve actual financial planning at all. What it does include is a meeting with an individual who has a title that leads consumers to believe they are receiving financial planning advice. However, in reality consumers are dealing with financial salesperson who is employed by organizations to solicit a specific product or series of products.”

The Ontario law will be enforced by the newly created Financial Services Regulatory Authority (FSRA), but the actual awarding of financial planner and financial advisor credentials will be done by professional organizations approved by the FSRA.

Ontario has yet to say which credentials will be recognized or what organizations will be involved in granting them.

While investor advocate Ken Kivenko acknowledges the law is better than no regulation, he was cautious about declaring it a win for investor protection.

“This is potentially a step in the right direction. Let’s wait and see.”
Kivenko says he wants to know who the credential-granting organizations will be, and what standards they will maintain in issuing and overseeing credentials.

He notes industry organizations have a poor record when it comes to supervising the conduct of their own members. And he asks whether the government is really ready to take on the banks and insurance companies over the titles they use for their legions of investment salespeople.

For a better regulatory model, you need look no further than the system in Quebec, where financial planners are regulated by the independent Institut québecois de planification financière (IQPF).

To be certified as a financial planner, individuals must meet high education standards set by the IQPF and follow continuing professional development courses. They are subject to disciplinary penalties for misconduct, must declare conflicts of interest and are prohibited from most self-dealing, according to the PIAC report.

The Quebec system also prohibits the use of a long list of titles, including financial advisor and wealth advisor.

It’s certainly positive that Ontario has moved to regulate the use of financial planning and financial advisor titles. But it remains to be seen how effective the new law will be in protecting investors.

The province needs to ensure the highest standards are maintained throughout the system—from granting credentials, to ongoing professional development to enforcement.

Hopefully, other provinces will soon follow suit. Ideally, there would be just one national regime, and it would be based on the Quebec model. In the real world of Canada’s patchwork of provincial regulators, I’ll settle for a system that actually delivers the quality of advice and protection that investors need and deserve.

About Anthony Layton MBA, CIM®, Chairman of the Board, Portfolio Manager

Tony is a founding partner, Chairman of the Board and Portfolio Manager at PWL in Montreal with over 35 years of experience helping clients achieve their financial goals. He is a firm believer that conflict-free advice is the only way to properly serve Canadian investors. ... ar-enough/
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Re: Broker/Advisor Disguise and Deception

Postby admin » Fri Jun 07, 2019 7:18 am

Advocate comment regarding this article: The CFA designation is indicative of the highest financial standards and ethics that I have found worldwide. I approve of anything I have seen that is CFA produced or related. (Although I am not a CFA:)

07 June 2019
A Rocky Road to Improved Investor Protection

By Mary Leung, CFA
Posted In: Financial Reporting

For most of 2018, the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry captured the attention of many in Australia. Through seven rounds of televised and livestreamed hearings, many problems in the industry came to light, including, among others,
advisers providing inappropriate advice, advisers failing to act in the best interest of their clients, conflicted remuneration structures leading to poor outcomes, and firms charging clients fees without providing associated services.
In February this year, the Commission published a final report containing 76 recommendations. If implemented in full, these recommendations would lead to significant changes across a number of fronts, including stricter disclosures, elimination of grandfathered commissions, changes in remuneration structures of both front-line and senior executives, and a revamp in culture and governance.

Of course, Australia is not alone in its concerns about investor protection. In Singapore, the failure of Hyflux Ltd, a water treatment company, has led to substantial losses for those who invested in Hyflux’s preference shares and perpetual securities. Ever since it emerged that many of these investors were individuals, the question as to why and how they were sold these risky instruments has been raised. After all, it has been a decade since the Lehman mini-bond saga; surely the problem of mis-selling should have been well and truly vanquished?

Mis-selling and Remuneration Structure

Unfortunately for many, mis-selling is not a new problem. The issues encountered in Singapore and Australia are symptomatic and only reinforce the negative image some of the public has of the financial services industry. Since the global financial crisis, regulators around the world have responded with a number of policy initiatives to combat mis-selling.

Inevitably, any discussion of mis-selling leads us to the topic of sales commission. Commissions and other monetary inducements are paid to financial advisers if they are successful in pushing products to their clients.
Even though, in some markets, financial advisers owe a duty of care to their clients and should only be selling products that are in their clients’ best interest, very often many are tempted to promote products that bring them the highest revenue, rather than recommend those that best meet their clients’ needs. Sales commissions also incentivize churning of portfolios.

Several jurisdictions have taken steps to address this conflict of interest. India introduced a commission ban in October 2018, and similar regulation has been introduced in South Korea. Taiwan recently eliminated commissions paid to fund distributors for marketing campaigns. On the other hand, market regulators in Hong Kong and Singapore have opted against the banning of commissions. Instead, they have adopted measures intended to improve fee transparency and to mandate disclosure of potential conflicts of interest.

Further afield, regulators in South Africa, Netherlands, and the UK have banned sales commissions paid to advisers outright. European jurisdictions subject to the Markets in Financial Instruments Directive (MiFID II) have also, in effect, instituted a partial ban on commissions, which applies to independent financial advisers. Instead of sales commissions, these markets have moved to a fee-based system.

In the UK, the widespread cases of mis-selling prompted the Retail Distribution Review (RDR) of distribution of financial products that led to a ban on commission payments. The ban relates to retail clients only and covers a range of retail investment products including equities, structured products, investment trusts, and pension policies. As a result of the ban, advisers in the UK can only be paid for their services by their clients.

Ahead of the ban, many commentators believed that the market would shrink, as advisers would leave the retail market altogether, creating an advice gap, or that retail investors would be reluctant to pay for advice. Some worried that even though a ban on commission would create better alignment between advisers and clients, new conflicts may arise. Even though the RDR reform was enacted in 2013, there isn’t yet any conclusive evidence as to how effective it has been and whether it achieved its legislative intent; however, a review undertaken by Europe Economics in 2014 found, among other things, that a ban on commissions had reduced product bias, product charges have been falling, advisers were more professional, and there were better disclosures. The Financial Conduct Authority is expected to conduct a post-implementation review this year.

Full and Fair Disclosure

Regardless of remuneration structures, potential conflicts may exist in a relationship between advisers and their clients. This is due to information asymmetry, which may create intentional or unintentional biases.
A number of research studies have shown that conflicted advisers give significantly more biased advice to the detriment of their clients.

Many regulators have sought to strengthen disclosures and enhance transparency requirements as a means of managing and reducing such conflicts. For example, in Hong Kong, following a consultation initiated in November 2016, the Securities and Futures Commission decided to strengthen the governance of the conduct of intermediaries who marketed themselves as independent and enhance the disclosure of monetary benefits received or receivable.

A frequently heard criticism of increased disclosures is that the increase in volume of disclosures does not necessarily translate into usefulness to the end user.
Very often disclosures are boilerplate and written in legalese. It is critical that investment advisers provide clear, concise, and clearly understandable disclosures, both about their company’s or their personal relationships with investment funds and product managers and how their remuneration is structured.
Investors should be able to ask about and understand the fees they are paying, and the level of professionalism of their adviser, in addition to understanding the potential gain and related risk factors. Without this knowledge, investors cannot make an educated decision on how and when to invest.

There also needs to be recognition that some conflicts of interest cannot be managed and should be completely eliminated. Certain incentives, such as winning sales contests and achieving internal sales targets, are irreconcilable with the concept of a best-interest standard if indeed this is the standard that advisers are held to.

Making It Work Everywhere

Clearly, there is no “one size fits all” solution to the problem of mis-selling. The way in which each jurisdiction responds will reflect current standards in force and the events that took place in their own countries during the last financial crisis. Each market has a different legal and regulatory environment and has different approaches to policy design. However, there are common themes that we can draw on, such as transparency.

In addition to transparency, governments should continue working with regulators and the industry on investor education. People who are financially literate make better financial decisions and manage money better than those without this knowledge. Higher financial literacy also alleviates the problem of asymmetric information between advisers and investors.

Creating Value for Our Clients

Amidst the negative perceptions and realities we often face, it is important to emphasize that the investment industry creates real value for its clients and for the communities it serves. However, for clients and regulators to understand this value, we must act, and be seen to act, as professionals.

Ultimately, advisers must be driven by what is best for their clients. Only by committing to the highest standards of professional and ethical behavior can we develop into a profession which creates tangible value for our clients and ensures finance has a purpose.
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Re: Broker/Advisor Disguise and Deception

Postby admin » Sat May 11, 2019 7:26 pm

Persons seeking information about fraud or false pretenses of industry registrants who proclaim “advisor” or “adviser” status might find information within this page and links to describe the registration categories and what is allowed or not allowed. (it must be noted that there is NO registration category for the word or the title “Advisor”, but there is legislation in most, if not all securities Acts regarding misrepresentation.)

This info comes from pages within the Manitoba Securities Commission ... duals.html

Guide to Individual Categories of Registration Securities Categories
Permitted Activities
Dealing Representative
may act as a dealer or an underwriter in respect of a security that the individual's sponsoring firm is permitted to trade or underwrite.

Advising Representative

may act as an adviser in respect of a security that the individual’s sponsoring firm is permitted to advise.

Associate Advising Representative
may act as an adviser in respect of a security that the individual’s sponsoring firm is permitted to advise on if the advice has been approved under subsection 4.2(1) [associate advising representatives – pre-approval of advice].

Ultimate Designated Person (UDP)
must do all of the following: (a) supervise the activities of the firm that are directed towards ensuring compliance with securities legislation by the firm and each individual acting on the firm’s behalf; (b) promote compliance by the firm, and individuals acting on its behalf, with securities legislation.

Chief Compliance Officer
(a) establish and maintain policies and procedures for assessing compliance by the firm, and individuals
acting on its behalf, with securities legislation;
(b) monitor and assess compliance by the firm, and individuals acting on its behalf, with securities legislation;
(c) report to the ultimate designated person of the firm as soon as possible if the chief compliance officer
becomes aware of any circumstances indicating that the firm, or any individual acting on its behalf, may be
in non-compliance with securities legislation and any of the following apply:
(i) the non-compliance creates, in the opinion of a reasonable person, a risk of harm to a client;
(ii) the non-compliance creates, in the opinion of a reasonable person, a risk of harm to the capital markets;
(iii) the non-compliance is part of a pattern of non- compliance;
(d) submit an annual report to the firm’s board of directors, or individuals acting in a similar capacity for the firm,
for the purpose of assessing compliance by the firm, and individuals acting on its behalf, with securities legislation.
Permitted Activities
Permitted Individual

(a) a director, chief executive officer, chief financial officer, or chief operating officer of a firm, or a functional equivalent of any of those positions,
(b) an individual who has beneficial ownership of, or direct or indirect control or direction over, 10 percent or more of the voting securities of a firm, or
(c) a trustee, executor, administrator or other personal or legal representative, that has direct or indirect control or direction over, 10 percent or more of the voting securities of a firm;


Individual Registration
An individual applying for registration must select one or more registration category. All individual registrations must be sponsored by a registered firm.
Indivdiuals registration categories under The Securities Act (Manitoba) are set out in Part 2 of National Instrument 31-103 - Registration Requirements and Exemptions. ... _guide.pdf ... duals.html

Individualcategories and permitted activities
[ ] Dealing Representative
[ ] Advising Representative
[ ] Associate Advising Representative
[ ] Ultimate Designated Person
[ ] Chief Compliance Officer
[ ] Permitted Individual
[ ] Officer–Specify title:
[ ] Director
[ ] Partner
[ ] Shareholder
[ ] Branch Manager (MFDA members only)
[ ] IIROC approval only ... 0/
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Re: Broker/Advisor Disguise and Deception

Postby admin » Thu May 02, 2019 4:19 pm

Misinformed Consent


John De Goey

There are some phrases that are used in all manner of contexts that are widely understood with a wry smile, but seldom contemplated with the serious effort leading to some sort of metaphysical mega-truth. One of my favourites is: “It ain’t what you don’t know that gets you into trouble, it’s what you know for sure that just ain’t so.” That little observation about the human condition has been mis-attributed to several humourists, including Mark Twain. The truth is that no one knows for sure who said it first. That’s especially ironic because there are lots of people out there who purport to know very well who said it, thereby demonstrating just how universal and applicable the phrase is.

There’s a second quip that I like almost as much. Given that it is more serious, I suspect fewer people have heard it. It is this:
“No reasonable person would consent to being given bad advice.”
In the world of personal finance, so much of what is covered by industry regulation revolves around the notion of informed consent. The problem here is that investor acquiescence is seen as a proxy for proper disclosure and conduct.

Now, let’s combine the two concepts to see where that takes us. How should we react to a situation where there are people who give advice based on concepts that they believe to be true, but are, in fact, not true? What happens when good intentions give way to bad advice?
If I give you advice based on misinformation and you accept and act on that advice, does that constitute “informed consent”?

I am a lifelong proponent of informed consent, but I also believe that there should be a recognition of a necessary premise. That premise is that the options under consideration should be presented fairly and accurately.
I consulted Wikipedia for a readily-accessible definition and here’s what I found: permission granted in the knowledge of the possible consequences, typically that which is given by a patient to a doctor for treatment with full knowledge of the possible risks and benefits. The write-up after the definition goes on to say that: an informed consent can be said to have been given based upon a clear appreciation and understanding of the facts, implications, and consequences of an action.

People who know me would also know that I have long yearned for financial advisors to be thought of (and held to the same standards) as doctors, dentists, lawyers and accountants. Given the definition, there are a few questions that might follow:

If people don’t really understand their options, can informed consent ever truly be provided?
If the people providing options don’t properly understand the salient details of what they are recommending (i.e., if they are unwittingly giving bad advice), does the acceptance of that advice constitute “informed consent”? Wouldn’t the term “misinformed consent” be more appropriate?

Stated differently, is informed consent even possible if the options being forwarded for consideration are incomplete, inappropriate or downright incorrect?
Sure, you might consent. You might have been ‘informed’ about your options from someone who has good intentions (i.e., who is not trying to mislead you). However, if the person making the recommendations is misinformed and is making the recommendations based on misguided beliefs, we have a moral dilemma. If the intentions are good, but the advice is nonetheless bad, how do we characterize the acceptance and implementation of that advice? Would your opinion change if the person giving the unwittingly bad advice refused to change the advice once the error in her ways was pointed out to her?

Full article can be found at the link below.

John J. De Goey, CIM, CFP, FELLOW OF FPSC™ is a registrant with Wellington-Altus Private Wealth Inc. (WAPW). WAPW is a member of the Canadian Investor Protection Fund (CIPF) and the Investment Industry Regulatory Organization of Canada (IIROC).
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Re: Broker/Advisor Disguise and Deception

Postby admin » Tue Apr 30, 2019 2:37 pm

At 1:20 "if you really do start a business model that says, my clients aren't my clients, they are really counter-parties that I can make money off shouldn't be surprised if you end up with a culture that is a greed culture that really doesn't do the right thing all the time…”

In a total time of about 3 min and 20 seconds, TD’s Ed Clark and Tony Robbins sum up the bait and switch that Mr. F was subjected to at his bank, where the firm and the broker says “trust me I am your advisor”, while dishonestly hiding from Mr. Fullerton the fact that they are mere salepersons and can (and do) treat Mr. F like a "counterparty" that they can make money off of….

Neil Weinberg, former Editor in Chief of American Banker Mag puts it into his own words in this OCT 18, 2013 article in American Banker Magazine:

“Financial Advisor Chicanery: Imagine a two-tiered health care system in which some doctors were legally obligated to do what's right for their patients and others, like snake-oil salesmen of yore, could recommend whatever treatments made them the most money, as long as they didn't kill patients outright.”

“Now imagine that the shysters did all they could to blend in with the real doctors. That's effectively the type of system we have today among the people Americans count on to tell them how to invest their life's savings. Registered investment advisors must, by law, put clients' interests first. Many thousands of other "advisors" at places like Morgan Stanley, Merrill Lynch and smaller shops are held to a much lower "suitability" standard.”

“In essence, even though these people often refer to themselves as "financial advisors" or by some other comfort-inducing title, they're really glorified salesmen. Some do a great job serving their clients. Others don't. It's up to them. Under the law, as long as they avoid putting an 85-year-old widow into an exotic derivative with a 20-year lockup, they're bulletproof.”

“Few clients know this fiduciary-suitability gap exists. The suitability crowd has worked tirelessly to keep the standard low and the distinctions murky. The cost to the public is incalculable but huge.” Full article is found here: ... 940-1.html (note 404: Page not found is an example of media “cleansing” of articles truthful or critical of financial industry practices)

Wall Street Journal
"...Most people do not realize that financial advisers (also known as financial planners, financial consultants, investment counselors, money managers, portfolio managers, wealth managers and other names) come in two flavours." ... d-brokers/


CFA Peter Benedek reviews "Is Your Advisor Deceiving You?"
"The professional who is willing to violate his own duty of loyalty and care to his clients is "placing an obstacle before the blind". ... e-16-2014/


Ron Rhoades Asst. Professor, Program Chair, Financial Planning Program, Alfred State College, Alfred, NY;
"I believe that holding yourself out as a trusted advisor, and not accepting fiduciary status and its burdens and restraints upon conduct, is tantamount to fraud." ... lieve.html


Make advisors work for investors, Financial Post
"Anything else is fraud, because the seller is delivering a service different from what the consumer thinks he or she is buying. "

Edward Waitzer article, Financial Post · Tuesday, Feb. 15, 2011) (Mr. Waitzer is a Bay Street Lawyer and former Securities Commission chair, and this quote ( by another person) appeared in his article.


Jul 5, 2012 INVESTING Wall Street Journal
Should You Go to an Adviser or an Advisor?

Associated Press The New York Stock Exchange
Long ago, investors bought stocks from "customer's men," who then became "registered representatives," who in turn morphed into "investment adviser representatives." Financial planners, meanwhile, became "financial advisers" and even "wealth managers."

Much like garbagemen rechristening themselves "sanitation engineers," the folks who flog investments are tweaking their titles to make what they do seem fancier and more impressive than it is.
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Re: Broker/Advisor Disguise and Deception

Postby admin » Fri Apr 19, 2019 9:49 am

This information is the essential “withholding” which prevents investors from knowing who and what they are dealing with. The dealing representative is the "commission sales guy” with 90 days experience...while the “Advising representative” is higher educated, which typically takes years, must have 48 months investment management experience, and both of these usually take a decade.

Proficiency Requirements for Registration

Screen Shot 2019-04-19 at 10.56.30 AM.png

Mutual fund dealer – dealing representative: the individual has passed - Canadian Investment Funds Course Exam
- Canadian Securities Course Exam
- Investment Funds in Canada Course Exam.
- Or the individual has earned a CFA Charter and has gained 12 months of relevant securities industry experience in the 36-month period before applying for registration.

Investment dealer - dealing representative: individual has passed
- Canadian Securities Course Exam
- Conduct and Practices Handbook Course and the 90-day training program.
Scholarship plan dealer – dealing representative: the individual has passed - The Sales Representative Proficiency Exam.
Exempt market dealer – dealing representative: the individual has passed
- Canadian Securities Course Exam
- Exempt Market Products Exam
- Or the individual has earned a CFA Charter and has gained 12 months of relevant
securities industry experience in the 36-month period before applying for registration.

Portfolio manager – advising representative: the individual has earned
- CFA Charter and has gained 12 months of relevant investment management
experience in the 36-month period before applying for registration
- Or the individual has received the Canadian Investment Manager designation and
has gained 48 months of relevant investment management experience.
o 12 months of which was gained in the 36-month period before applying for

Portfolio manager – associate advising representative: the individual has completed
- Level 1 of the Chartered Financial Analyst program and has gained 24 months of
relevant investment management experience.
- Or the individual has received the Canadian Investment Manager designation and
has gained 24 months of relevant investment management experience.

*Please see CSA Staff Notice 31-332 Relevant Investment Management Experience for Advising Representatives and Associate Advising Representatives of Portfolio Managers for examples of what is considered relevant investment management experience.

SOURCE: ... ements.pdf

Industry experience tells me that in the requirements above, it takes an average participant five to ten years or working in the business prior to attaining the CFA designation, or similar to obtain the Canadian Investment Manager qualifications. (this author obtained ASSOCIATE PORTFOLIO MANAGER (one step removed from PORTFOLIO MANAGER) designation after perhaps 10 years work and courses within RBC.)
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Re: Broker/Advisor Disguise and Deception

Postby admin » Thu Feb 21, 2019 3:34 pm

Screen Shot 2018-04-02 at 10.29.40 PM.jpg

Begin forwarded message:

From: CSA ACVM Secretariat <>
Date: February 21, 2019 at 3:16:57 PM EST
To: ‘K (name and e-mail removed)
Subject: RE: Question on registration

Mr. K,

In response to your query, National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (“NI 31-103”) sets out the categories of registration for firms and individuals. Dealing representative is the category of registration for an individual who is required to act on behalf of a firm registered in a dealer category. All IIROC firms are registered in a dealer category (Investment Dealer). As such all individuals who are acting on behalf of an IIROC firm would be registered as a dealing representative under NI 31-103.

Dealing representative is the category of registration for an individual who is required to act on behalf of a firm registered in a dealer category.
(Relevant bold and quoted portions were highlighted by investor-advocates to highlight the pertinent info)

“Registered Representative” is a status assigned by IIROC to individuals employed by IIROC member firms. Looking at the IIROC website, IIROC’s rules describe a registered representative as an employee or agent of an investment dealer who is approved by IIROC to trade and advise in securities with the public in Canada. The proficiency requirements for Registered Representatives (RR) vary according to the Products and/or Customer types that the RR deals with. By definition, an RR is acting on behalf of a firm registered in a dealer category.

By definition, an RR is acting on behalf of a firm
(Relevant quoted portions repeated by investor-advocates to highlight the pertinent)
As such, a registered representative will be registered as a dealing representative under NI 31-103.

a registered representative will be registered as a dealing representative
(Relevant quoted portions repeated by investor-advocates to highlight the pertinent)

CSA Secretariat

Screen Shot 2018-04-30 at 6.40.16 PM.png


Autorités canadiennes en valeurs mobilières / Canadian Securities Administrators

(514) 864-9510

Screen Shot 2018-04-23 at 6.53.29 PM.png
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Re: Broker/Advisor Disguise and Deception

Postby admin » Thu Nov 29, 2018 9:49 pm

I received this response from the OSC today, in answer to questions about some investment sales agents (registered Dealing Representatives, not Advising Representatives) who were advertising themselves as “Advisors”, "Portfolio Managers”, and “First Vice presidents”, all of which are bogus marketing titles. (adviser is legally spelled “advisER” in law)

The reply from the OSC was professional and informed. I was pleasantly surprised and even a bit embarrassed by some of my former rants about regulators. I may have tarred all regulators with the same brush, when in fact it is only those “team players” at the top who tarnish the entire system. Anyway this reply was thoughtful and factual and of value to the public, so I will share it here. (now if only they would actually apply the law and the rules.....:)

Here is the informative reply and behind it was my question posed to the OSC, in case you are interested:
I have placed in bold, and underlined, some of the more pertinent answers given by the OSC so that they may be more easily spotted by those who need to find the most important info quickly.
On Nov 29, 2018, at 2:02 PM, wrote:
Dear Mr. Elford:

Thank you for your email to the Ontario Securities Commission (OSC). You are concerned about individuals in the investment industry who you believe are misrepresenting their registration categories to give investors a false sense of trust.

You wrote that you recently noticed a financial team at CIBC promoting themselves on TV, radio, and web sites as if they were advisors, Senior Vice Presidents, and also Portfolio Managers.

You specifically refer to two individuals who are registered with CIBC Wood Gundy, which is a business name used by CIBC World Markets Inc. (CIBC WM). CIBC WM is registered in the category of Investment Dealer. As I believe you are aware, Investment Dealers are directly regulated by the Investment Industry Regulatory Organization of Canada (IIROC), a recognised self-regulatory organisation (SRO).

All individuals who are trading, and who are sponsored by firms registered as Investment Dealer, are registered in the category of "Dealing Representative". This is what you see when you look at the CSA website for categories of registration.

As mentioned in previous correspondence to you on this topic, the term Adviser is used in Ontario securities law to describe companies or individuals registered only to give advice about securities. The term “advisor” is not defined in Ontario securities law. The most common Adviser registration category is Portfolio Manager. Portfolio managers typically handle all the investment decisions for an individual’s portfolio, but they cannot carry out trades. All related trading activity based on the PM’s decisions would typically be carried out by an investment dealer.

Portfolio Manager
Apart from the adviser registration category described above, portfolio manager is also an IIROC registration category and refers to registered representatives who have been approved for managing investment portfolios through discretionary authority provided by their clients.

For your reference, IIROC provides a list of IIROC approval categories on their website at this link: ... egories%22

Senior Vice President
This title is not a registration category.
Many companies provide corporate titles that are separate from their registration categories.

What Investors Need to Know
We have also mentioned to you in the past that business titles, designations for courses completed, and professional memberships may be informative, but for investors the important thing to know is the person's registration category. Regardless of a person’s business title or job description, their registration category will tell you what products they are permitted to trade or advise about, and the services they are allowed to provide. It is important to check registration with the appropriate securities regulator or SRO, or on the CSA website. For the individuals you’ve listed the appropriate SRO is IIROC.

You may wish to refer to a response I sent to you on this subject in an email dated May 11, 2015. My former colleague, Jeffrey Fennell, also corresponded with you on this topic, on several occasions. His most recent response was dated June 3, 2011.

You may wish to contact IIROC, if you have further queries about the titles given to registered individuals that it directly regulates. Their contact information is available at this link:


Nicole Plotkin
Senior Inquiries Officer
Ontario Securities Commission


Larry Elford email to the OSC Inquiries:
Date: November 28, 2018 05:10 PM

Subject: An inquiry to the OSC regarding title and registration representation rules and/or what constitutes misrepresentation of titles, job functions and registration categories (Vice President etc)

Dear OSC. I am concerned about persons in the investment industry who misrepresent their registration categories to give investors a false sense of trust.

I have recently noticed a financial team at CIBC heavily promoting themselves on TV, radio and web sites as if they were “advisors”, “Senior Vice Presidents” and also “Portfolio Managers”.

The CSA registration search shows them registered as “Dealing Representatives”, and I am confused as to how these other titles are allowed to be used. I am familiar with the representation rules (Ontario Securities Act sec 44) which seem quite clear about what constitutes representation or misrepresentation.

I am also inquiring about whether or not there are any “exemptive relief” decisions at the OSC on use of the title “Portfolio Manager”? I seem to recall seeing such exemptions in the past and I wonder if that might be the reason that a few persons are beginning to refer to themselves by this title.

Perhaps you could help me to better understand what, if any requirements there are in order to call oneself an “Advisor”, an “Adviser”, a “Portfolio Manager”, or a “Vice President, First Vice President” etc?

Here are the screen images for the specific team that brought this issue to my attention, however I have noticed groups at Richardson also using the “Portfolio Manager” terminology. Thank you for shining a light into any of my questions so that I can become more informed and understand what is being allowed to happen to investors.

Larry Elford
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Re: Broker/Advisor Disguise and Deception

Postby admin » Mon Oct 08, 2018 9:42 pm

A recent article about the poor behavior of Primerica’s mutual fund sales tactics prompted me to check the license and registration search for a number of firms like this one (not sure if Primerica is truly deserving of being called a “firm”, but bear wth me..)

Here is what I found:

Primerica shows up with 6785 total registrants and 6784 “Dealing Representatives (salespersons).
This means that there is ONE person at Primerica who holds the correct license to call themselves an adviser...??

Screen Shot 2018-10-08 at 10.33.54 PM.png

SUN LIFE is found to have 3450 registrants at the firm in ALL registration categories, and only 20 records found in the category legally allowed to refer to themselves as “Adviser”. I do notice that Sun pretends to dodge the legal ‘representation’ requirements found in Provincial Securities Acts with a clever “vowel movement” or portraying their sales force as “advisORS” instead of “advisERS”. This is still a violation, but it seems to help the regulators think that the public will never figure out the fraud...

Screen Shot 2018-10-08 at 10.44.56 PM.png

Jumping over the the banks, where the real money is handled in Canada (although the insurance companies are no slouches) we begin with National Bank with 4117 persons registered with the Canadian Securities Administrators (CSA) and twelve (12) are shown to have an Advising Representative registration.

Screen Shot 2018-10-08 at 10.51.18 PM.png

Next lets peek at one of Canada’s biggest mutual fund manufacturers and sellers, Investors Group. A CSA search turns up a total of 4030 persons today, at Investors, and 3976 of those listed as “Dealing Representatives”.

Screen Shot 2018-10-08 at 10.51.18 PM.png

Sadly, what the regulators are missing (or are paid to miss?) is that this is a bit like finding out that the College of Physicians and Surgeons is letting 3976 medical industry pill salespersons, falsely represent themselves to the public as if they were “Doctors”.
Imagine how many pills one could sell if all your customers thought you were working under a “Do No Harm” protective duty or care, while truly you were working to get a new condo...THAT is the standard daily practice of most agents/employees of the giant financial firms, and the regulators appear well paid to ignore the ruse...

Jumping to a “top five” bank, CIBC, they show a total of 10585 registrants at the CSA, 95 of which appear in a search for “Advising Reps”.

Screen Shot 2018-10-08 at 11.01.49 PM.png

TD shows 29025 registrants, with 893 having the “Advising Rep” registration, although the search shows that many of those do not work within TD at all, but merely use TD as a conduit, a “correspondent network”, or as a “back office” to handle trades, statement generation or other office details to persons who work elsewhere or who work independently. The following screen image capture illustrates the smorgasbord of company names who show up under a search within TD:

Screen Shot 2018-10-08 at 11.09.02 PM.png

I will stop there for now, to not overload this posting, and hope that it might someday be of help to people who are concerned about their money, and wish to learn how easy it is to ‘game’ the system and the regulators. To be continued....
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