CSA/ACVM |
Canadian
Securities
Administrators |
Autorités
canadiennes
en valeurs mobilières |
For
Immediate Release |
|
January 21, 2002 |
Securities commissions report top investor complaints
Toronto -- Investor complaints continue to flow into securities regulators across
Canada, most often stemming from a relationship breakdown between a financial adviser and
an investor. However, unscrupulous behavior also continues to arise in the marketplace.
"Securities regulators strive to protect investors through the administration and
enforcement of securities laws in each jurisdiction across Canada," said Doug
Hyndman, Chair of the Canadian Securities Administrators (CSA), the umbrella organization
representing the 13 provincial and territorial securities commissions.
"But investors need to help protect themselves by doing their homework and being
proactive in building a good relationship with their investment adviser."
The CSA list of top five complaints and how to avoid them:
- Suitability
Increasingly, investors are contacting securities regulators
after finding themselves in investments that they do not believe are suitable for them. It
is critical for investors to ensure that the "Know Your Client" forms they must
complete on the opening of an account are up-to-date and that advisers are well aware of
investment objectives and risk tolerance levels.
- Customer Service
General customer service issues such as delays in
transferring of accounts continue to be a problem in the industry. Investors could reduce
delays by: getting professional assistance when completing forms, avoiding transfers
during peak season, reading about the companys policies ahead of time, and following
up with the institution they are transferring from.
- Unauthorized trades
Investment advisers are not allowed to make trades on an
account without the investors permission unless the adviser has been given
discretionary authority over the account (note that only specially qualified advisers are
allowed to accept this authority). Investors who have not given discretionary authority
should monitor their account to ensure unauthorized trading isnt occurring.
- Disclosure
Many investors are still in the dark about fees, and in
particular, about mutual fund fees. Investors should read the prospectus and ask questions
if they still dont understand the fee structure of their investment. The Mutual Fund
Fees Impact Calculator found on a number of regulators web sites may help investors
understand how fees can impact their investment returns over time.
- Scams and frauds including unregistered sales
-- There is a growing number of scams
and frauds being reported across the country. The best way investors can protect
themselves from fraud is to do their homework. Ask questions. Check with your securities
regulator to verify the registration of an adviser. Read all documents carefully.
Dont fall for guarantees of high returns with low risk.
An investor who has a complaint should:
- Contact the adviser directly be sure to make detailed notes of any conversations.
- Write to the branch manager with a copy to the firms compliance officer.
- Contact the provincial or territorial securities regulator in writing.
- Securities regulators cannot get investors money back. Instead, investors should
contact a lawyer and they have the option of going to small claims court or proceeding to
civil court or an arbitration program.
The CSA (www.csa-acvm.ca) has developed a number
of investor resources aimed at helping investors avoid many of the most frequent
complaints listed above. In addition, most jurisdictions have print or web resources on
how to file a complaint. Contact your jurisdiction for a free Investor Education Kit.
Media relations contacts:
Joni Delaurier
Alberta Securities Commission
403-297-4481
www.albertasecurities.com
|
Andrew Poon
B.C. Securities Commission
604-899-6880
1-800-373-6393 (B.C. & Alberta only)
www.bcsc.bc.ca |
Ainsley Cunningham
Manitoba Securities Commission
204-945-4733
1-800-655-5244 (Manitoba only)
www.msc.gov.mb.ca |
Suzanne Ball
N.B. Securities Administration Branch
506-658-3060
1-866-933-2222 (N.B. only)
securities.branch@gnb.ca |
Frank Switzer
Ontario Securities Commission
416-593-8120
www.osc.gov.on.ca
|
Denis Dubé
Commission des valeurs mobilières du Québec
514-940-2163
1-800-361-5072 (Quebec only)
www.cvmq.com |