On Tuesday, April 23, American public television PBS aired an insightful one hour television program entitled “The Retirement Gamble” which highlighted the impact of high mutual fund fees on retirement security. The program stressed the fact that a 2 percent annual mutual fund fee can strip savers of almost two-thirds of returns over 50 years, leaving the investor with only one-third of the returns in exchange for risking all the capital. According to John Bogle…

FAIR Canada has submitted comments to Canadian securities regulators, stating that urgent reforms must be made to the mutual fund fee structure in order to protect consumers. With over 12 million Canadians owning mutual funds, and 72% of Canadians with RRSPs holding mutual funds within their RRSPs, it is clear that mutual funds are important to the retirement savings and financial security of Canadians. Improved disclosure is important but is inadequate to address the serious conflicts of interest presented by embedded (hidden) commissions (referred to as trailing commissions). These conflicts are systemic and structural in nature and are not addressed by current regulatory initiatives. To address these serious issues, we urge the banning of third-party embedded commissions…

FAIR Canada provided comments to the British Columbia Securities Commission (“BCSC”) in response to its request for comments arising from its proposed prospectus exemption to assist capital raising by small business. FAIR Canada disagrees with removing the requirement to provide audited financial statements in connection with the Offering Memorandum (“OM”) prospectus exemption. A critical review of the level of investor protection afforded under the OM prospectus exemption needs to be undertaken…

The Federal Government has released the final regulations which will govern external complaints bodies that will handle complaints made by consumers that have not been resolved successfully through the internal complaints process at the bank. The regulations are not substantively different from the proposed regulations that came out last April and on which FAIR Canada provided its comments…

OBSI has resorted to “name and shame” against the Victoria, B.C. mutual fund dealer Connor Financial in respect of unsuitable investment recommendations that led clients to lose money. OBSI’s news announcement is available here. The Investor Advisory Panel wrote to the Office of the Investor earlier this year recommending that while OBSI does not have the power to enforce its recommendations for restitution currently, the “…regulators do, can and should. There should be an immediate regulatory review by the relevant regulators of all rejected recommendations for restitution and timely action taken to ensure appropriate compliance.”…

FAIR Canada has submitted comments to Canadian securities regulators, stating that urgent reforms must be made to the mutual fund fee structure in order to protect consumers. Improved disclosure is important but inadequate to address the serious conflicts of interest presented by embedded (hidden) commissions (referred to as trailing commissions)…

FAIR Canada made a submission to the Investment Industry Regulatory Organization of Canada (“IIROC”) supporting guidance regarding the use of business titles and financial designations. The submission stressed the importance of ensuring that titles and designations do not mislead Canadian consumers. We are also writing to the members of the Canadian Securities Administrators recommending that they to follow IIROC’s lead in ensuring that titles are not misleading and requiring firms to have policies and procedures in place with respect to business titles and financial designations…

In conjunction with national “Check Registration Day”, FAIR Canada has written an open letter to the Canadian Securities Administrators (“CSA”) calling for a simplified, comprehensive national database to assist Canadian consumers in checking the registration of any person or firm who sells securities or offers investment advice…

FAIR Canada does not believe that investors have the requisite information to make an informed decision in the absence of audited financial statements and recommends that the OM exemption orders issued in Yukon, Alberta, Saskatchewan, Northwest Territories, Nunavut, Manitoba, Quebec, Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador be revoked and encourages the CSA to undertake a more critical review of the level of investor protection afforded under the OM exemption, given the serious compliance issues observed…

FAIR Canada Executive Director discusses the CFA Institute’s Statement of Investor Rights on BNN’s Market Sense with hosts Randy Cass and Catherine Murray on March 18, 2013.