# The client always comes last



## james4beach (Nov 15, 2012)

Here's an interesting article from CBC's Go Public, though I don't see anything groundbreaking in this

'Canada is in the Dark Ages': Investment insiders reveal how lax laws put your financial interests last



> "I definitely sold things that people didn't need — 95 per cent of the time," said a former BMO financial services manager who recently quit because she says she could no longer stomach putting the bank's interests ahead of those of her clients.
> ...
> "When I came home, I just kept questioning myself," she said. "If this was my own grandfather, I wouldn't do this to him, so why am I doing this to this guy?"


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## investorted (Feb 27, 2017)

james4beach said:


> Here's an interesting article from CBC's Go Public, though I don't see anything groundbreaking in this
> 
> 'Canada is in the Dark Ages': Investment insiders reveal how lax laws put your financial interests last


Time to short bank stocks ?


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## Beaver101 (Nov 14, 2011)

investorted said:


> Time to short bank stocks ?


 ... careful here as you're going to offend a lot of bank investors here! Note this cancer is not isolated to the banks but other financial entities as well


> ... He says it's a problem with the *banks, insurance companies and the rest of the financial industry, which operates with "the same questionable compensation arrangements and incentives*." ...


.


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## Beaver101 (Nov 14, 2011)

james4beach said:


> Here's an interesting article from CBC's Go Public, *though I don't see anything groundbreaking in this
> *
> ...


 ... agree as long as there continues, 



> *Talk and more talk
> *
> For more than a decade, *Canada's regulators **have mulled the idea *of a fundamental shift from the existing sales-based system to one that would always put the investor first.
> 
> ...


 but I wonder if the turning of blind-eyes by our regulators extend to the US as well?


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## lonewolf :) (Sep 13, 2016)

Huge fraud in education students are burdened with loans for degrees that are totally useless


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## TomB19 (Sep 24, 2015)

This isn't new but it is getting worse. Last year at this time, I worked for a company that supplied services to major banks in both Canada and the US. The attitude of the folks in charge is beyond belief. Don't expect any relief from the screw job they have been escalating.

I believe what we are seeing is the Americanizing of Canadian banks.

How is gouging of customers a reason to short banks? It should be a reason to buy and hold. As long as they control the government, they can treat Canadians pretty harshly.

My favorite are the charges that show up on your statement for insurance you don't want. The last time that happened, I called to cancel the overdraft insurance. The girl said, "OK. It's canceled starting next month." I said, "Great. Now go ahead and back out this month's charge." She said, "I can't do that." I said, "Oh, that charge is coming off there." ... she went away for a bit and came back and said the charge is removed. lol!


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## mark0f0 (Oct 1, 2016)

If you think this is bad, wait until the housing market's current stagnation/declining prices turns into a crash and the government has to fork out $100-$200B to repay CMHC's guarantees in a deflationary environment. 

Basically the Canadian banks have systemicized the transfer of wealth from the public to themselves. Soon the CRA will actually be collecting profits for the banks instead of them having to do pesky stuff like operating branches and having salespeople to do that for them.


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## gibor365 (Apr 1, 2011)

> 'Canada is in the Dark Ages': Investment insiders reveal how lax laws put your financial interests last


 All financial institutions all over the World are doing exactly same thing! Banks is Israel are 10 times worse than in Canada. My brother was living in Finland, now in UK.... from what he;s telling, Canadian banks are not too bad.

btw, the worst in Canada - Lifecos who selling segregated funds. Those are real parasites of the society. I worked in this industry , I know how it's done


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## treva84 (Dec 9, 2014)

A for profit entity is interested in making profits, and uses aggressive tactics to do so? You don't say....

I'm not sure why people are so up in arms about this. Does the general public cry afoul when their car salesman pressures them into closing the deal and adds un-necessary fees like etching, rust proofing, etc? Does the general public cry afoul when their retailer tries to sell them the un-necessary extended warranty on the new TV?

Why are banks viewed as "nice guys"? Why are advisers, incentivized to sell the best products for the company (which are generally the worst product for the individual) considered by the population, by default, to always act in their clients best interest?

There's a Buffet saying that comes to mind - "When someone with money meets someone with experience, the person with the experience gets the money and the person with the money gets experience".


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## Beaver101 (Nov 14, 2011)

^ How about this - can you avoid using services from the financial sector?


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## Nerd Investor (Nov 3, 2015)

Beaver101 said:


> ^ How about this - can you avoid using services from the financial sector?


The financial sector as a whole? Probably not. But there are enough options out there (now more than ever) that no one is forced to buy high priced bank mutual funds (discount brokerages, robo-advisors, Tangerine etc. Heck, you can hold everything exclusively with one of the big banks and still make out well by using their discount brokerage, making sure you're in the right type of account and meet the criteria needed to avoid/reduce fees etc. All it takes is a bit of research which for some reason many people don't seem willing to do. People can be funny. I know folks that will do months of research before buying a new smart phone but won't put 1/10th of that time into their finances.

As for the regulators, they need to do something but I'm not sure what the answer is. Fee based accounts generally make sense (and are pretty common among Wealth Management firms) but this will leave small investors in the dust. I do think they should make it possible to be licensed to give investment advice without selling/managing the investments.


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## treva84 (Dec 9, 2014)

Beaver101 said:


> ^ How about this - can you avoid using services from the financial sector?


No, but you can make informed decisions with a bit of financial literacy, rather than naively believing whatever the bank tells you. 

(As an aside, the fact that they are unavoidable demonstrates the wide moat they have - also their ability to consistently raise fees despite negative press is a substantial showing of pricing power, but that's a discussion for another thread).


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## birdman (Feb 12, 2013)

The restaurant business is just as bad. How often when you go to a fast food place do they ask: "Can we Supersize that for you?" or "Can we make that a combo"? Fries and pop have huge margins and worse yet, they are unhealthy choices. Other restaurants are just about as bad with trying to encourage you to have appetizers and liquor. Stock trading is a bargain these days when compared to the previous 29.95 a trade and before that you talked to a broker who if I recall correctly charged you about 100.00 or therabouts??? Auto service is another scam where they always want to up sell. Gas station convenience stores are another rip off for just about anything you buy. Some independent financial advisors are scum and churn accounts for unsuspecting clients. One must educate themselves and be diligent.


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> As for the regulators, they need to do something but I'm not sure what the answer is. Fee based accounts generally make sense (and are pretty common among Wealth Management firms) but this will leave small investors in the dust. I do think they should make it possible to be licensed to give investment advice without selling/managing the investments.



NI before you joined here we had a member named moneyGal, a financial planner with actuarial experience who was herself a license examiner for the planning association.

she always said that fee-based advisors don't really exist, because the work doesn't pay. What most of them are, is financial product salesmen in disguise. Or they are referral salesmen.

me i totally believe moneyGal. I think most under $1M portfs can manage basic financial planning on their own or get a boost from a robo-plan or even from a bank product salesman in the branch, then make a few substitutions if the latter.

i also think that the multi-$Ms require specialized accountants & lawyers to plan their corporations & their global interests. Even with these, the sailing is not smooth. Just watch multi-$Ms in this forum as they report on their meetings with gilt-edged advisors who are candidates to manage their accounts. These latter are not always helpful, apparently often appear to be hustling for the business, tch.


.


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## OnlyMyOpinion (Sep 1, 2013)

I just wanted to suggest there is nothing magical about how under or over $1MM needs to be managed. Certainly those with their own businesses and complex holdings will probably use/require an accountant and FA, but less complex portfolios well into multi-$MM's can be DIY - more so these days than in years past.

BTW, I see an opportunity for a new thread - $1M is used very commonly for 1 million but I've always used $1MM (and $1K for 1 thousand and $1B for 1 billion). Am I wrong?


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## Eder (Feb 16, 2011)

Isn't it fun to find new reasons each day to be outraged. So silly lol.


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## Eder (Feb 16, 2011)

OnlyMyOpinion said:


> BTW, I see an opportunity for a new thread - $1M is used very commonly for 1 million but I've always used $1MM (and $1K for 1 thousand and $1B for 1 billion). Am I wrong?


Its the way I understand it....btw 1 HS is 10 thousand.


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## Nerd Investor (Nov 3, 2015)

humble_pie said:


> NI before you joined here we had a member named moneyGal, a financial planner with actuarial experience who was herself a license examiner for the planning association.
> 
> she always said that fee-based advisors don't really exist, because the work doesn't pay. What most of them are, is financial product salesmen in disguise. Or they are referral salesmen.
> 
> ...


I guess I should specify; by fee-based I mean advisers who are compensated by a % of the client's portfolio rather than via embedded commissions. Unfortunately, that type of structure is generally only available to the high net worth crowd because otherwise it simply isn't lucrative enough (as you've pointed out).


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## Spudd (Oct 11, 2011)

OnlyMyOpinion said:


> BTW, I see an opportunity for a new thread - $1M is used very commonly for 1 million but I've always used $1MM (and $1K for 1 thousand and $1B for 1 billion). Am I wrong?


The metric unit for million is M. However, in business they often use M for thousands and MM for millions, using the roman numerals instead of the metric system.


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## Eclectic12 (Oct 20, 2010)

frase said:


> The restaurant business is just as bad.
> How often when you go to a fast food place do they ask: "Can we Supersize that for you?" or "Can we make that a combo"? ...


+1 ...




frase said:


> ... Stock trading is a bargain these days when compared to the previous 29.95 a trade and before that you talked to a broker who if I recall correctly charged you about 100.00 or therabouts???


I've mentioned that my mom paid $200 for one full service brokerage buy in the past. 

In case there are doubts ...


> *In 1983*, the commission on 1,000 shares at $10 each would have been *$240 at a full-service broker*, $70 at the average discounter and $64 at a deep discounter. Last year that same transaction cost about $285 at a full-service broker and about $89 at most discounters. *At some deep discounters it was as little as $48.*


http://www.nytimes.com/1990/06/17/b...-small-investors-discount.html?pagewanted=all

So yes, I'd say $9.99 down to $6.95 as well as commission free ETF purchases are a bargain. :biggrin:


Cheers


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## Eclectic12 (Oct 20, 2010)

Nerd Investor said:


> I guess I should specify; by fee-based I mean advisers who are compensated by a % of the client's portfolio rather than via embedded commissions. Unfortunately, that type of structure is generally only available to the high net worth crowd because otherwise it simply isn't lucrative enough (as you've pointed out).


At the same time, when Mom decided she didn't have the time for it, the fee based advisor AFAICT was putting her into a couple of funds. He didn't seem to be doing much of anything for his take versus the other advisor who was proactive and seemed far more useful.


There does not seem to be a magic bullet - either way.



Cheers


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## Eclectic12 (Oct 20, 2010)

treva84 said:


> Nerd Investor said:
> 
> 
> > Beaver101 said:
> ...


Not sure why using financial sector services automatically means paying for stuff one does not want/need and/or would be expensive.

It does not help when the gov't agency reviewing fees then publishing info as well as the consumer reporters cut corners to say "minimum annual bank fees one can pay" versus myself having the same account where I paid $0 in fees for years.


Cheers


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## Dilbert (Nov 20, 2016)

I dunno, with an electronic background, 1M was always 1 Meg / Million to me. I think bean counters have their own lingo, however...:lemo:


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## Nerd Investor (Nov 3, 2015)

Eclectic12 said:


> At the same time, when Mom decided she didn't have the time for it, the fee based advisor AFAICT was putting her into a couple of funds. He didn't seem to be doing much of anything for his take versus the other advisor who was proactive and seemed far more useful.
> 
> 
> There does not seem to be a magic bullet - either way.
> ...


True. In theory, tying compensation directly to account value should mean the adviser's interests are aligned with the investors (ie: maximizing the value of the account). But it's also easy to get complacent when they know they are being paid regardless and focus their time on getting additional outside assets. Agreed, no magic bullet.


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## james4beach (Nov 15, 2012)

OnlyMyOpinion said:


> I just wanted to suggest *there is nothing magical about how under or over $1MM needs to be managed*. Certainly those with their own businesses and complex holdings will probably use/require an accountant and FA, but less complex portfolios well into multi-$MM's can be DIY - more so these days than in years past.


I agree. I also think it's feasible to self manage a few million. Transaction costs are very low and modern discount brokerages allow excellent order fills, and access to a huge range of products.

I think you'll still need a tax expert (especially for retirement tax optimization) but I think you can definitely invest a few million yourself. Seems quite simple to deploy say 5 million as a diversified portfolio.


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## Eclectic12 (Oct 20, 2010)

Nerd Investor said:


> True. In theory, tying compensation directly to account value should mean the adviser's interests are aligned with the investors (ie: maximizing the value of the account). But it's also easy to get complacent when they know they are being paid regardless and focus their time on getting additional outside assets. Agreed, no magic bullet.


Were the minimum bar is high enough ... being essentially a MF salesperson works just as well as the trailer fees flavour.


Cheers


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> I guess I should specify; by fee-based I mean advisers who are compensated by a % of the client's portfolio rather than via embedded commissions. Unfortunately, that type of structure is generally only available to the high net worth crowd because otherwise it simply isn't lucrative enough (as you've pointed out).




yes, there is a lot of confusion over what the term "fee-based advisor" really means, isn't there?

i see, now, how you intend the phrase, but that wasn't how i was understanding the phrase. I understood "fee-based" in the way moneyGal meant, namely, a finance professional who charges & bills based on time only.

theoretically, billing for time should make FP services available even to relatively modest investors. What moneyGal was saying was that the public doesn't go for this model & generally is not willing to pay, therefore it's not a profitable business unless the financial advisor has add-ons like selling financial products on the side.

quite often we've heard here in the forum about "fee-based" financial planners who officially have an hourly rate that generates a range of fees for a fin plan - often between $3500 & 6000 - but who are willing to waiive the fee entirely if the client will accept to buy the planner's recommended products.

turning now to nerd investor's definition - a fee based on a percentage of portfolio value - such a fee usually starts at 1% - what i observe is that, today, $1M is not enough to command superior attention. 

five years ago gluskin sheff looked for $2M as a minimum account. The threshhold has probably risen substantially since.

recently i learned that a greatly respected investment counsel in montreal - it's a boutique firm with a loyal clientele down through 3 generations - is now requiring $10M as a minimum account before they are prepared to offer any individualized private services.

this firm offers pooled funds only to ordinary investors with less than $10M. The pooled fund package is a common plan offered to investors in the $1M-10M range, i believe.

i'm certainly happy to see many people on here affirming that it's easily possible to run a 7 or even 8 figure portfolio without any fancy advisors. 

.


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## Beaver101 (Nov 14, 2011)

treva84 said:


> No, but you can make informed decisions with a bit of financial literacy, rather than naively believing whatever the bank tells you.
> 
> (As an aside, the fact that they are unavoidable demonstrates the wide moat they have - also their ability to consistently raise fees despite negative press is a substantial showing of pricing power, but that's a discussion for another thread).


 ... ah, it's not just the banks but also insurance and asset management companies who have been contracted to handle your pension monies.


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## Beaver101 (Nov 14, 2011)

Eder said:


> Isn't it fun to find new reasons each day to be outraged. So silly lol.


 ... no, it's neither fun nor silly to get outraged here when you're the kid of that 85 year who had been ridiculously (being polite here too) recommended something inappropriate,



> .. The former BMO employee says she still feels guilty about *putting an 85-year-old customer who was in poor health into a mutual fund owned by the bank,* after her manager urged her to do it for the sales revenue


. 

And how ethical is that?


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## Nerd Investor (Nov 3, 2015)

humble_pie said:


> yes, there is a lot of confusion over what the term "fee-based advisor" really means, isn't there?
> 
> i see, now, how you intend the phrase, but that wasn't how i was understanding the phrase. I understood "fee-based" in the way moneyGal meant, namely, a finance professional who charges & bills based on time only.
> 
> ...


Yes, I tend to think of billing for time as "fee for service" and taking a percentage of assets as "fee based". Then again, unless I specify that, how is one to know? There doesn't seem to be any official/agreed upon terminology. There is a very small group of truly unbiased Financial Planners who offer planning for either a flat fee or bill their time, and who are not selling anything else. However, I think it is still a hard sell for most Canadians to spend $1,500 - $3,000 or more for a financial plan. 

The other issue is the unbiased Financial Planners I referred to above are not permitted to give specific investment advice because they are not licensed / regulated to sell investments.


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> There is a very small group of truly unbiased Financial Planners who offer planning for either a flat fee or bill their
> time, and who are not selling anything else.


that's what moneyGal used to say. The size of the group is almost infinitesimal. I think moneyGal's known list included one actuary & one qualified financial planner. The latter had a $3500 minimum & that was 2-3 years ago. The actuary would have been higher.





> However, I think it is still a hard sell for most Canadians to spend $1,500 - $3,000 or more for a financial plan.


i'm just going by MG's mentioned rates for 2-3 years ago. Since that time i've heard of $6000 for a couple plan fairly often. So i'd guesstimate a good plan might run $3500-6000.





> The other issue is the unbiased Financial Planners I referred to above are not permitted to give specific investment advice because they are not licensed / regulated to sell investments.


often these financial advisors with no broker or mutual fund license sell unregulated investments to accredited investors. They are allowed to do that. These products are the MICS & other dodgy stuff. Accredited investors in most provinces need only $1M (ontario a bit more, some other provinces a bit less, i believe) There are a fair number of vulnerable widows & retirees in that category, so every year we see the sad stories in newspapers about how some scoundrel here or there has made off with the booty.


btw i wasn't meaning $1M as any kind of magical threshhold figure when i posted that figure above. I just meant very roughly ballpark, below which many adults can draw up their own plan, although it takes some time & some work.

jas4 is right, too, when he says a portfolio can easily be self-directed into the 7 figures. A great deal depends on the age of the subject. Someone who is 65 or older requires simplified investments with less risk & can even begin moving away from USD back into CAD. Or if he is a snowbird, at least planning for the day when he won't be travelling the US so extensively. 

.


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## Nerd Investor (Nov 3, 2015)

humble_pie said:


> that's what moneyGal used to say. The size of the group is almost infinitesimal. I think moneyGal's known list included one actuary & one qualified financial planner. The latter had a $3500 minimum & that was 2-3 years ago. The actuary would have been higher.
> 
> 
> 
> ...


Yes, I was curious so I checked out a few of those types of planners: seems my range was probably on the low end. I always forget that the rules are completely different for accredited investors. Excuse the ignorance, but MICS stands for what?


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## twa2w (Mar 5, 2016)

Fee only ( or fee for service) financial planners charge a fee for preparing a plan or parts of a plan. 
There are three sub groups of this type.
Unlicensed fee only who charge you a fee but also may collect a fee for referring you to an investment manager.
Licensed fee only advisors who may recommend specific products and who may or may not refer you to an investment manager.
A true fee only planner who does a proper plan with specific asset allocation recommendations and guidelines on how to pick the investments. Also known as a unicorn.

A fee based planner or investment advisor charges a % fee based on assets held with him/ her.. Usually plans are limited in scope and are really a sales tool to gather assets.
Some of these masquerade as a fee only planner but waive the fee if you invest with them.

Many 'planners' are investment or insurance sales and the plan is just an asset gathering sales tool. It will cover some basic tax, life and disability insurance and asset allocation.
It will be quite lacking in estate, succession planning, cash flow, income planning, splitting etc. It will not usually review home and auto insurance, nor will it delve into you benefits plan tbrough work.

There are some very good conscientious people in all categories but very rare.

Every planner or salesperson has some bias regardless of compensation,


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## AltaRed (Jun 8, 2009)

I scanned this thread but didn't see anyone mention the distinction between 'advisor' and 'adviser'. The former are mostly licensed salespersons as already articulated and have no fudiciary duty to you (unless otherwise specified). The latter, as I understand it, is a specific designation with a fudiciary duty to you. Finding an 'adviser' is hard to do these days since most are beholden to their companies. That said, I've used 'fee for service' advisers a few times in the past (once on a collaborative Separation Agreement) and I see that one I used in Calgary is still around per LinkedIn. I personally would have no use for a '% of AUM' adviser, but I can understand how that might be necessary for those who don't want (or don't feel competent) to have much of anything to do with their portfolio, etc.


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## m3s (Apr 3, 2010)

AltaRed said:


> I scanned this thread but didn't see anyone mention the distinction between 'advisor' and 'adviser'.


Was about to bring up the same. CBC coverage was the first time I'd heard of this distinction.






Pre-CMF days I'd discussed investments with an advisor and luckily walked away skeptical


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## GreatLaker (Mar 23, 2014)

I had a financial plan done on a flat rate fee-for service basis. The planner refers to her business as "financial planning" and "fee-for-service financial planner". The service is focused on planning more than investment advice. The firm will create plans for a flat rate, then do updates on an $ per hour basis. They also offer planning and investments on a % AUM basis, and with that service the creation of the plan and advice are included in the fee based on % of assets.

She told me that if all her clients were like me she would not have much of a business. Charging people a one-time flat fee with maybe a couple of updates every few years is a tough gig. On an AUM basis I would pay at least 3x every year what the one time plan cost. Hence most advisers/advisors look for clients that are willing to pay ongoing fees as a % of assets. 

Another planner I interviewed seemed mystified that anyone would want to DIY their investing (or maybe he was not mystified, but rather wanted me to believe it was just too hard.)

I get the feeling that most / many of the clients are families and professionals that don't have time or interest to DIY and are happy to have someone take care of it all for them with a better service level than available at a bank or big broker. Horses for courses.


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## TomB19 (Sep 24, 2015)

I've never dealt with anyone I thought even remotely had my well being in mind, until my current person at TD. She is great.

She doesn't advise me. She has never recommended anything. She just does what I ask. It's an absolutely ideal relationship and I have a ton of respect for her.

When she is not there and I have to deal with someone else, it feels like forcibly receiving a gasoline enema. "Let's see... it looks like you need some insurance."

The idea of people trying to rip us off is not new. It was invented the moment someone created the idea of currency.

... but this advisor/adviser bit is a new low. lol!


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## humble_pie (Jun 7, 2009)

m3s said:


> CBC coverage was the first time I'd heard of this [advisor/adviser] distinction.




let's not get too hung up on how the CBC fancies a couple of vowels in the alphabet. The important thing about their Go Public piece is that a lot of financial product salespersons can give themselves all kinds of fancy titles which don't really mean anything.

formerly, only parties licensed to call themselves "investment counsel" were allowed to practice discretionary portfolio management. That is, they could buy & sell securities in a client's portfolio, for the client's benefit, without having to consult the client. Investment counsel were supposed to have the highest standards of ethical conduct & generally speaking, this rule was & remains more or less true (at least i for one think so) (highly subjective opinion here.)

these days the IIROC & other authorities have selected the title "portfolio manager" for the same kind of discretionary portfolio management. The term "investment counsel" is now obsolete. The title of "portfolio manager" has also been extended to experienced stockbrokers in broker firms who have to pass exams to earn the moniker.

but whether they continue to call themselves investment counsel or whether they fly by the newer title of portfolio manager, these creatures generally don't take a client with less than $2M.

.


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## redsgomarching (Mar 6, 2016)

hey whats wrong with bank advised mutual funds? i made 40% return off the bmo resource fund last year.


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## humble_pie (Jun 7, 2009)

twa2w said:


> Fee only ( or fee for service) financial planners charge a fee for preparing a plan or parts of a plan.
> There are three sub groups of this type.
> Unlicensed fee only who charge you a fee but also may collect a fee for referring you to an investment manager.
> Licensed fee only advisors who may recommend specific products and who may or may not refer you to an investment manager.
> ...



in canada, regulation of financial conduct goes province by province. Believe it or not, there is a securities authority in every province.

so i believe that what you are describing is how-it-works in one province only. 

.


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> Excuse the ignorance, but MICS stands for what?




a mortgage investment corporation

https://en.wikipedia.org/wiki/Mortgage_investment_corporation


these don't trade publicly, so their shares are exempt from listing requirements of a public exchange such as the TSX. Some reportedly have no prospectuses. Some reportedly don't even issue annual financial statements, let alone quarterly.

shares are privately sold by financial "advisors" or "planners." Buyers must be accredited investors but the standard minimum for an individual investor across most canadian provinces is $1 million. I believe one prairie province - either manitoba or saskatchewan, not sure which - has a minimum for accreditation that is much less, so of course a number of shady outfits tend to headquarter in that province.

non-publicly traded investments don't have to be just MICs. Canada has seen some weird & wonderful enterprises being flogged. I've heard of a tree farm in costa rica for example. Other sure-fire money-making enterprises in which gullible investors are persuaded to invest are startup medical tourism clinics in 3rd world countries. The list of possible alternative investment schemes for "accredited investors" is endless. Because there's a sucker born every minute.

i'm not sure how an investor disposes of his shares in a MIC. I believe it's only by redeeming them to the original issuing company. Obviously if a MIC falls on hard times, it can't redeem without selling its real estate properties, so usually there's a very long lead time required for share redemption, like a year or more.

bref, these are nightmare investments for vulnerable widows & retirees, yet often they're marketed with higher than normal rates of return, at least at first, so generations of victims continue to fall for them.

now & then a MIC salesman strays across cmf forum. Not too many because cmffers usually out them, ie the forum is not a profitable patch for them to troll their sales pitches.

.


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## Koogie (Dec 15, 2014)

GreatLaker said:


> I had a financial plan done on a flat rate fee-for service basis. The planner refers to her business as "financial planning" and "fee-for-service financial planner". The service is focused on planning more than investment advice. The firm will create plans for a flat rate, then do updates on an $ per hour basis. They also offer planning and investments on a % AUM basis, and with that service the creation of the plan and advice are included in the fee based on % of assets.


I also had a plan done by a fee only planner (not someone who was AUM) when I was starting out as a DIY-er and it was money well spent (circa 1500.00$) They are getting to be more common nowadays than some people might think. As with other trends which begin in the US, it takes time for the concept to spread north and for people to become aware of it.

My portfolio now makes me a target for shysters since I qualify as an "accredited investor" I still manage the portfolio myself but have a fool for a client.. :emmersed:


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## Brainer (Oct 8, 2015)

Umm...yeah...last time I checked, I don't think the used care sales reps. were guided by a charter. The banks are supposed to provide certain levels of service based
on the privilege of behing chartered. If they're going to abuse that, then hell, why not just take it on the chin when your chartered accountant takes your money. What the hell, right?






treva84 said:


> A for profit entity is interested in making profits, and uses aggressive tactics to do so? You don't say....
> 
> I'm not sure why people are so up in arms about this. Does the general public cry afoul when their car salesman pressures them into closing the deal and adds un-necessary fees like etching, rust proofing, etc? Does the general public cry afoul when their retailer tries to sell them the un-necessary extended warranty on the new TV?
> 
> ...


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## Nerd Investor (Nov 3, 2015)

humble_pie said:


> a mortgage investment corporation
> 
> https://en.wikipedia.org/wiki/Mortgage_investment_corporation
> 
> ...


Merci!


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> Merci!




in the interests of maintaining a balanced view, though, it should be said that some private alternative investments of the MIC type might be good deals. I imagine an investor would need to be exceptionally close to the principal parties, in order to have a clue about what is going on. Ordinary accredited investors wouldn't fit into this category, so the unregulated aspect of these investments is what turns me off.

i am not sure what is the difference between MIC type investment scams for gullible accredited investors & legitimate venture capital pools. I'm not close enough to either field to understand their subtleties, but as you know, Nerd Investor, there has to be a difference.

no one would want to quash or stifle or deprive legitimate emerging new enterprises of the startup funding they need. One has to believe, therefore, that venture capital pools & angel investor groups have sophisticated mechanisms for detecting scams & frauds.

gosh, think how many cmffers enjoy hanging on Dragons' Den & similar programs, being entertained by all the weird & wonderful sales pitches from new nano-businesses that are looking for backers!

.


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## Eclectic12 (Oct 20, 2010)

Brainer said:


> Umm...yeah...last time I checked, I don't think the used care sales reps. were guided by a charter. The banks are supposed to provide certain levels of service based on the privilege of behing chartered.


Do you have any references for the level of service?

The references I can find say that a bank charter is about "financial intermediation", which is bringing together of borrowers and lenders. 
http://www.thecanadianencyclopedia.ca/en/article/chartered-bank/
http://www.bankingcanada.net/canadian+chartered+banks/
http://financial-dictionary.thefreedictionary.com/Chartered+Bank


It seems more like a business license than anything that is determining tactics or code of conduct. 




Brainer said:


> If they're going to abuse that, then hell, why not just take it on the chin when your chartered accountant takes your money. What the hell, right?


I know of people who have taken it on the chin so a charter does not guarantee anything either. BTW, it seems that "chartered accountant" is an obsolete term in Canada as it is not "chartered professional accountant".


Cheers


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## Nerd Investor (Nov 3, 2015)

Eclectic12 said:


> Do you have any references for the level of service?
> 
> The references I can find say that a bank charter is about "financial intermediation", which is bringing together of borrowers and lenders.
> http://www.thecanadianencyclopedia.ca/en/article/chartered-bank/
> ...


Yes and no. We still get to keep the *CA* after *CPA* for next decade or so :triumphant:


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## humble_pie (Jun 7, 2009)

Nerd Investor said:


> We still get to keep the *CA* after *CPA* for next decade or so :triumphant:



that's good. I think the designation is very helpful for clients. The corporation should agree to keep it permanently.

.


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## TomB19 (Sep 24, 2015)

How long do you think it would be, before I was charged with a crime, if I were to promote myself as a "chartered Accountent" and use at as a platform to sell things to people, even if they don't need them?


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## humble_pie (Jun 7, 2009)

TomB19 said:


> How long do you think it would be, before I was charged with a crime, if I were to promote myself as a "chartered Accountent" and use at as a platform to sell things to people, even if they don't need them?



how could you "promote yourself as a 'chartered accountant' " though?

the high professional corporations are zealous in outing imposters. I don't believe a fake CA would last more than a month.

when it comes to selling investment products, CAs around here do a fair amount of such selling. They know their clients, they know the products, they're pretty good at knowing what fits with whom.

would i buy something from a CA though? 
never have
probably never will

each:

.


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## Nerd Investor (Nov 3, 2015)

humble_pie said:


> that's good. I think the designation is very helpful for clients. The corporation should agree to keep it permanently.
> 
> .


Well, for new graduates it won't matter; they've overhauled the system so everyone going through now follows the same process and come out as CPAs. I agree the distinction is helpful, but it will gradually lose importance as time goes on.


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## TomB19 (Sep 24, 2015)

I wouldn't bill myself as an "accountant. I would bill myself as an "Accountent" with an "e".

Who wants me to do their taxes? Lol


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## Beaver101 (Nov 14, 2011)

TomB19 said:


> How long do you think it would be, before I was charged with a crime, if I were to promote myself as a "chartered Accountent" and use at as a platform to sell things to people, even if they don't need them?


 ... never ... whistle-blowing laws are just that "it blows" and that's it, hush hush.


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