FAIR Canada believes that group scholarship plans are generally poor savings vehicles with little or no benefits to consumers. They are often aggressively marketed and advertised, and commonly target modest or lower income Canadians. Many purchasers are urged to ……

The recent issue of OSC Investor News cautions investors about the risks of leveraged investing. While we are pleased to see the OSC recognizing issues relating to leverage, we have some concerns about some statements in this Investor News piece. It warns investors that borrowing money to purchase investments increases risk and provides a mathematical example to demonstrate how losses are magnified if the investment goes down in value. It points out that leveraged investing can result in much greater losses than investing using one’s own cash…

On January 26, 2012, FAIR Canada Director Claude Lamoureux will be invested with the Order of Ontario medal. Mr. Lamoureux was appointed to the Order of Ontario in 2008 for his immense contribution to the area of corporate governance in Canada and internationally. The Order of Ontario is the highest provincial honour bestowed upon an individual in Ontario, and is awarded to the “greatest minds, forward-thinkers, humanitarians, activists and pioneers”…

The Ontario Securities Commission (OSC) disclosed the extent to which fines and other monetary sanctions are actually collected in a news release issued on January 18. FAIR Canada is pleased to see this significant improvement in transparency on the part of the OSC – it is another indication of the sea change in the OSC since Howard Wetston became chair…

A draft study commissioned by the Public Safety Department, reported in Investment Executive, warns that Canada’s multi-jurisdictional regulatory system leaves the securities system vulnerable to organized crime. The study highlights several weaknesses that FAIR Canada identified in its Report on a Decade of Financial Scandals, including “a lack of co-ordination and political will to target violators, complicated multi-jurisdictional regulatory systems…

David Baines of the Vancouver Sun has published another article detailing an abusive leverage strategy. Enzo DuVuono recommended and sold $750,000 worth of mutual funds, using their $500,000 home as collateral, to an older couple who were “experiencing difficulty paying their monthly expenses”. The MFDA has alleged that DuVuono did so without ensuring that the investments and leveraged investment strategy were suitable and appropriate for the clients, who were 77 years old and retired and 56 years old and unemployed…

In a recent Globe & Mail column, columnist Preet Banerjee demonstrates how investments fees will consume a large portion of your original investment over time. For example, if you invest in a mutual fund with an MER of 2.36 per cent, the MER will consume 44.96 per cent of your original investment over 25 years. A prospectus will often convey this by a chart which shows an investor will pay $300 on a $1,000 investment over 10 years…