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Monthly Archives: April 2015

A “best interests” standard may shield senior investors – A “PECULIAR CHALLENGE”?


By James Langton, Investment Executive, February 2015


The clamour for a “best interests” standard in the securities industry is growing ever louder. A new report suggests that regulators consider adopting a stricter conduct standard as a way to deal with the added challenges posed by the growing population of senior investors.


In mid-January, the Ontario Securities Commission (OSC) released a report in which it flags the introduction of a “best interests” standard as a possible solution to many of the concerns that senior investors face.


The conclusions of the report were based upon a roundtable event that the OSC hosted this past autumn in partnership with its independent investor advisory panel (IAP). The event included an assortment of government policy wonks, seniors groups and health-care professionals, along with the usual cast of regulators, and industry and investor advocates.


The focus of the session was the peculiar challenges posed by senior investors.


The report and a previously unreleased consultation paper circulated during the session outline the growing importance of seniors’ issues to the securities industry and to regulators.


The underlying demographic reality is well known: Canada’s population is aging, which means that the ranks of senior investors is growing. And seniors are living longer, which means the demands of financing retirements also are growing.


Moreover, if the average retail investor is challenged to understand basic financial terms, industry product disclosure and concepts such as suitability, these challenges are intensified among seniors, who face the prospect of diminishing cognitive abilities as they age. The consultation paper reports that various academic studies have found that “investment performance declines significantly after age 70 as memory and reasoning ability diminishes.”


Seniors more vulnerable


The paper also points out that research has found that while financial literacy and cognitive performance declines with age, seniors’ confidence in their abilities does not: “The combination of sustained or increased confidence in financial decision-making [in combination] with reduced abilities raises concerns. Diminished capacity makes seniors more vulnerable to unsuitable investment advice, predatory practices, investment fraud and financial abuse.”


When senior investors suffer losses – whether due to markets or malfeasance – they often have less ability to recover financially, given that they’re likely to be retired from the workforce and have shorter time horizons than younger investors do.


The report indicates that adoption of a best interests standard of conduct for the industry would do a better job than the existing “suitability” standard to shield seniors in cognitive decline, preparing them for retirement and helping them to optimize their financial assets in retirement.


Of course, a best interests standard, which is under consideration by the Canadian Securities Administrators, would have effects well beyond just the senior investor population. And, as the report acknowledges, such a standard is unlikely to do much to protect seniors against fraud. Nevertheless, the growing challenge of protecting senior investors is one more factor in favour of a move to this standard.


At this point, though, regulators aren’t committing to anything. The roundtable and the subsequent report simply are informing regulators’ policy plans.


“We’re reviewing the report as part of the ongoing discussions as we engage in our annual business planning process,” says Rhonda Goldberg, director of the OSC’s Investment Funds and Structured Products Branch.


That process sets the regulatory agenda for the year ahead, and often longer, as these regulatory policy priorities typically are multi-year endeavours.


The IAP has long called for the introduction of a best interests standard and will continue to do so. But, in the wake of the roundtable, the IAP now also is considering where else to devote its energy, says Connie Craddock, the IAP’s chairwoman.


A very positive step


The roundtable represents a very positive step, in terms of defining the specific issues posed by senior investors, for regulators and other policy-makers, Craddock says, a step that will help to guide the IAP as it develops its advocacy agenda for the coming year.


This agenda could include focusing on advisor proficiency, titles or licensing. Other measures cited in the report include using more mystery shopping to assess the quality of investment advice (a report on the regulators’ first effort at this is expected to be published by March); examining the use of powers of attorney; enhancing the complaint process; and numerous other policy ideas.


Craddock also notes that the investment industry is doing some good work on its own to address these issues – as outlined in a report from the Investment Industry Association of Canada last year, which examined the best practices that are in use at some investment firms in dealing with senior clients.


As policy-makers contemplate how to protect senior investors better, these practices could start to find their way onto the agendas of securities regulators and investor advocates as well.


© 2015 Investment Executive. All rights reserved.



“The focus of the session was the peculiar challenges posed by senior investors.”















Dan Zwicker




Undisclosed cash flowed to Clinton foundation as Russians pressed to control one fifth of U.S. Uranium

Jo Becker And Mike Mcintire,

The New York Times

 April 23, 2015

The headline in Pravda trumpeted President Vladimir Putin’s latest coup, its nationalistic fervor recalling an era when the newspaper served as the official mouthpiece of the Kremlin: “Russian Nuclear Energy Conquers the World.”

The article, in January 2013, detailed how the Russian atomic energy agency, Rosatom, had taken over a Canadian company with uranium-mining stakes stretching from Central Asia to the American West. The deal made Rosatom one of the world’s largest uranium producers and brought Putin closer to his goal of controlling much of the global uranium supply chain.

But the untold story behind that story is one that involves not just the Russian president, but also a former U.S. president and a woman who would like to be the next one.

At the heart of the tale are several men, leaders of the Canadian mining industry, who have been major donors to the charitable endeavors of former President Bill Clinton and his family. Members of that group built, financed and eventually sold to the Russians a company that would become known as Uranium One.

Beyond mines in Kazakhstan that are among the most lucrative in the world, the sale gave the Russians control of one-fifth of all uranium production capacity in the United States. Since uranium is considered a strategic asset, with implications for national security, the deal had to be approved by a committee composed of representatives from a number of U.S. government agencies. Among the agencies that eventually signed off was the State Department, then headed by Clinton’s wife, Hillary Rodham Clinton.

As the Russians gradually assumed control of Uranium One in three separate transactions from 2009 to 2013, Canadian records show, a flow of cash made its way to the Clinton Foundation. Uranium One’s chairman used his family foundation to make four donations totaling $2.35 million. Those contributions were not publicly disclosed by the Clintons, despite an agreement Hillary Clinton had struck with the Obama White House to publicly identify all donors. Other people with ties to the company made donations as well.

And shortly after the Russians announced their intention to acquire a majority stake in Uranium One, Bill Clinton received $500,000 for a Moscow speech from a Russian investment bank with links to the Kremlin that was promoting Uranium One stock.

At the time, both Rosatom and the U.S. government made promises intended to ease concerns about ceding control of the company’s assets to the Russians. Those promises have been repeatedly broken, records show.

The New York Times’ examination of the Uranium One deal is based on dozens of interviews, as well as a review of public records and securities filings in Canada, Russia and the United States. Some of the connections between Uranium One and the Clinton Foundation were unearthed by Peter Schweizer, a former fellow at the right-leaning Hoover Institution and author of the forthcoming book “Clinton Cash.” Schweitzer provided a preview of material in the book to The Times, which scrutinized his information and built upon it with its own reporting.

Whether the donations played any role in the approval of the uranium deal is unknown. But the episode underscores the special ethical challenges presented by the Clinton Foundation, headed by a former president who relied heavily on foreign cash to accumulate $250 million in assets even as his wife helped steer U.S. foreign policy as secretary of state, presiding over decisions with the potential to benefit the foundation’s donors.

In a statement, Brian Fallon, a spokesman for Hillary Clinton’s presidential campaign, said no one “has ever produced a shred of evidence supporting the theory that Hillary Clinton ever took action as secretary of state to support the interests of donors to the Clinton Foundation.”

He emphasized that multiple U.S. agencies, as well as the Canadian government, had signed off on the deal and that, in general, such matters were handled at a level below the secretary.

“To suggest the State Department, under then-Secretary Clinton, exerted undue influence in the U.S. government’s review of the sale of Uranium One is utterly baseless,” he added.

U.S. political campaigns are barred from accepting foreign donations. But foreigners may give to foundations in the United States. In the days since Hillary Clinton announced her candidacy for president, the Clinton Foundation has announced changes meant to quell long-standing concerns about potential conflicts of interest in such donations; it has limited donations from foreign governments, with many, like Russia’s, barred from giving to all but its health care initiatives. That policy stops short of Hillary Clinton’s agreement with the Obama administration, which prohibited all foreign government donations while she served as the nation’s top diplomat.

Either way, the Uranium One deal highlights the limits of such prohibitions. The foundation will continue to accept contributions from foreign individuals and businesses whose interests, like Uranium One’s, may overlap with those of foreign governments, some of which may be at odds with the United States.

When the Uranium One deal was approved, the geopolitical backdrop was far different from today’s. The Obama administration was seeking to reset strained relations with Russia. The deal was strategically important to Putin, who shortly after the Americans gave their blessing sat down for a staged interview with Rosatom’s chief executive, Sergei Kiriyenko.

“Few could have imagined in the past that we would own 20 percent of U.S. reserves,” Kiriyenko told Putin.

Now, after Russia’s annexation of Crimea and aggression in Ukraine, the Moscow-Washington relationship is devolving toward Cold War levels, a point several experts made in evaluating a deal so beneficial to Putin, a man known to use energy resources to project power around the world.

“Should we be concerned? Absolutely,” said Michael McFaul, who served under Hillary Clinton as the U.S. ambassador to Russia but said he had been unaware of the Uranium One deal until asked about it. “Do we want Putin to have a monopoly on this? Of course we don’t. We don’t want to be dependent on Putin for anything in this climate.”

 A Seat at the Table

The path to a Russian acquisition of U.S. uranium deposits began in 2005 in Kazakhstan, where Canadian mining financier Frank Giustra orchestrated his first big uranium deal, with Bill Clinton at his side.

The two men had flown aboard Giustra’s private jet to Almaty, Kazakhstan, where they dined with the authoritarian president, Nursultan Nazarbayev. Clinton handed the Kazakh president a propaganda coup when he expressed support for Nazarbayev’s bid to head an international elections monitoring group, undercutting U.S. foreign policy and criticism of Kazakhstan’s poor human rights record by, among others, his wife, then a senator.

Within days of the visit, Giustra’s fledgling company, UrAsia Energy Ltd., signed a preliminary deal giving it stakes in three uranium mines controlled by the state-run uranium agency Kazatomprom.

If the Kazakh deal was a major victory, UrAsia did not wait long before resuming the hunt. In 2007, it merged with Uranium One, a South African company with assets in Africa and Australia, in what was described as a $3.5 billion transaction. The new company, which kept the Uranium One name, was controlled by UrAsia investors including Ian Telfer, a Canadian who became chairman. Through a spokeswoman, Giustra, whose personal stake in the deal was estimated at about $45 million, said he sold his stake in 2007.

Soon, Uranium One began to snap up mining companies with assets in the United States. In April 2007, it announced the purchase of a uranium mill in Utah and more than 38,000 acres of uranium exploration properties in four Western states, followed quickly by the acquisition of the Energy Metals Corp. and its uranium holdings in Wyoming, Texas and Utah. That deal made clear that Uranium One was intent on becoming “a powerhouse in the United States uranium sector with the potential to become the domestic supplier of choice for U.S. utilities,” the company declared.

Still, the company’s story was hardly front-page news in the United States – until early 2008, in the midst of Hillary Clinton’s failed presidential campaign, when The Times published an article revealing the 2005 trip’s link to Giustra’s Kazakhstan mining deal. It also reported that several months later, Giustra had donated $31.3 million to Bill Clinton’s foundation.

Although the article quoted the former head of Kazatomprom, Moukhtar Dzhakishev, as saying that the deal required government approval and was discussed at a dinner with Nazarbayev, Giustra insisted that it was a private transaction, with no need for Bill Clinton’s influence with Kazakh officials. He described his relationship with the former U.S. president as motivated solely by a shared interest in philanthropy.

As if to underscore the point, five months later Giustra held a fundraiser for the Clinton Giustra Sustainable Growth Initiative, a project aimed at fostering progressive environmental and labor practices in the natural resources industry, to which he had pledged $100 million. The star-studded gala, at a conference center in Toronto, featured performances by Elton John and Shakira and celebrities like Tom Cruise, John Travolta and Robin Williams encouraging contributions from the many so-called FOFs – Friends of Frank – in attendance, among them Telfer. In all, the evening generated $16 million in pledges, according to an article in The Globe and Mail.

“None of this would have been possible if Frank Giustra didn’t have a remarkable combination of caring and modesty, of vision and energy and iron determination,” Bill Clinton told those gathered, adding: “I love this guy, and you should, too.”

But what had been a string of successes was about to hit a speed bump.

Arrest and Progress

By June 2009, a little more than a year after the star-studded evening in Toronto, Uranium One’s stock was in free-fall, down 40 percent. Dzhakishev, the head of Kazatomprom, had just been arrested on charges that he illegally sold uranium deposits to foreign companies, including at least some of those won by Giustra’s UrAsia and now owned by Uranium One.

Publicly, the company tried to reassure shareholders. Its chief executive, Jean Nortier, issued a confident statement calling the situation a “complete misunderstanding.” He also publicly contradicted Giustra’s contention that the uranium mining deal had not required government blessing.

“When you do a transaction in Kazakhstan, you need the government’s approval,” he said, adding that UrAsia had indeed received that approval.

But privately, Uranium One officials were worried they could lose their joint mining ventures. U.S. diplomatic cables made public by WikiLeaks also reflect concerns that Dzhakishev’s arrest was part of a Russian power play for control of Kazakh uranium assets.

At the time, Russia was already eying a stake in Uranium One, Rosatom company documents show. Rosatom officials say they were seeking to acquire mines around the world because Russia lacks sufficient domestic reserves to meet its own industry needs.

It was against this backdrop that the Vancouver-based Uranium One pressed the U.S. Embassy in Kazakhstan, as well as Canadian diplomats, to take up its cause with Kazakh officials, according to the U.S. cables.

“We want more than a statement to the press,” Paul Clarke, a Uranium One executive vice president, told the embassy’s energy officer June 10, the officer reported in a cable. “That is simply chitchat.”

What the company needed, Clarke said, was official written confirmation that the licenses were still valid.

The U.S. Embassy ultimately reported to the secretary of state, Hillary Clinton. Although the Clarke cable was copied to her, it was given wide circulation, and it is unclear if she would have read it; the Clinton campaign did not address questions about the cable.

What is clear is that the embassy acted, with the cables showing that the unnamed energy officer met with Kazakh officials to discuss the issue on June 10 and 11.

Three days later, a wholly owned subsidiary of Rosatom completed a deal for 17 percent of Uranium One. And within a year, the Russian government would substantially up the ante, with a generous offer to shareholders that would give it a 51 percent controlling stake. But first, Uranium One had to get the U.S. government to sign off on the deal.

The Russians are easily winning the uranium war, and nobody’s talking about it. It’s not just a domestic issue but a foreign policy issue, too

The Power to Say No

When a company controlled by the Chinese government sought a 51 percent stake in a tiny Nevada gold mining operation in 2009, it set off a secretive review process in Washington, where officials raised concerns primarily about the mine’s proximity to a military installation but also about the potential for minerals at the site, including uranium, to come under Chinese control. The officials killed the deal.

Such is the power of the Committee on Foreign Investment in the United States. The committee comprises some of the most powerful members of the Cabinet, including the attorney general, the secretaries of the Treasury, Defense, Homeland Security, Commerce and Energy, and the secretary of state. They are charged with reviewing any deal that could result in foreign control of a U.S. business or asset deemed important to national security.

The national security issue at stake in the Uranium One deal was not primarily about nuclear weapons proliferation; the United States and Russia had for years cooperated on that front, with Russia sending enriched fuel from decommissioned warheads to be used in U.S. nuclear power plants in return for raw uranium. Instead, it concerned U.S. dependence on foreign uranium sources. While the United States gets one-fifth of its electrical power from nuclear plants, it produces only around 20 percent of the uranium it needs, and most plants have only 18 to 36 months of reserves, according to Marin Katusa, author of “The Colder War: How the Global Energy Trade Slipped From America’s Grasp.”

“The Russians are easily winning the uranium war, and nobody’s talking about it,” said Katusa, who explores the implications of the Uranium One deal in his book. “It’s not just a domestic issue but a foreign policy issue, too.”

When ARMZ, an arm of Rosatom, took its first 17 percent stake in Uranium One in 2009, the two parties signed an agreement, found in securities filings, to seek the foreign investment committee’s review. But it was the 2010 deal, giving the Russians a controlling 51 percent stake, that set off alarm bells. Four members of the House of Representatives signed a letter expressing concern. Two more began pushing legislation to kill the deal.

Sen. John Barrasso, R-Wyo., where Uranium One’s largest U.S. operation was, wrote to President Barack Obama, saying the deal “would give the Russian government control over a sizable portion of America’s uranium production capacity.”

“Equally alarming,” Barrasso added, “this sale gives ARMZ a significant stake in uranium mines in Kazakhstan.”

Uranium One’s shareholders were also alarmed and were “afraid of Rosatom as a Russian state giant,” Sergei Novikov, a company spokesman, recalled in an interview. He said Rosatom’s chief, Kiriyenko, sought to reassure Uranium One investors, promising that Rosatom would not break up the company and would keep the same management, including Telfer, the chairman. Another Rosatom official said publicly that it did not intend to increase its investment beyond 51 percent and that it envisioned keeping Uranium One a public company

U.S. nuclear officials, too, seemed eager to assuage fears.

The Nuclear Regulatory Commission wrote to Barrasso assuring him that U.S. uranium would be preserved for domestic use, regardless of who owned it.

“In order to export uranium from the United States, Uranium One Inc. or ARMZ would need to apply for and obtain a specific NRC license authorizing the export of uranium for use reactor fuel,” the letter said.

Still, the ultimate authority to approve or reject the Russian acquisition rested with the Cabinet officials on the foreign investment committee, including Hillary Clinton – whose husband was collecting millions of dollars in donations from people associated with Uranium One.

Undisclosed Donations

Before Clinton could assume her post as secretary of state, the White House demanded that she sign a memorandum of understanding placing limits on her husband’s foundation’s activities. To avoid the perception of conflicts of interest, beyond the ban on foreign government donations, the foundation was required to publicly disclose all contributors.

To judge from those disclosures – which list the contributions in ranges rather than precise amounts – the only Uranium One official to give to the Clinton Foundation was Telfer, the chairman, and the amount was relatively small: no more than $250,000, and that was in 2007, before talk of a Rosatom deal began percolating.

But a review of tax records in Canada, where Telfer has a family charity called the Fernwood Foundation, shows that he donated millions of dollars more, during and after the critical time when the foreign investment committee was reviewing his deal with the Russians. With the Russians offering a special dividend, shareholders like Telfer stood to profit.

His donations through the Fernwood Foundation included $1 million reported in 2009, the year his company appealed to the U.S. Embassy to help it keep its mines in Kazakhstan; $250,000 in 2010, the year the Russians sought majority control; as well as $600,000 in 2011; and $500,000 in 2012. Telfer said that his donations had nothing to do with his business dealings and that he had never discussed Uranium One with Bill or Hillary Clinton. He said he had given the money because he wanted to support Giustra’s charitable endeavors with Bill Clinton.

“Frank and I have been friends and business partners for almost 20 years,” he said.

The Clinton campaign left it to the foundation to reply to questions about the Fernwood donations; the foundation did not provide a response.

Telfer’s undisclosed donations came in addition to between $1.3 million and $5.6 million in contributions, which were reported, from a constellation of people with ties to Uranium One or UrAsia, the company that originally acquired Uranium One’s most valuable asset: the Kazakhstan mines. Without those assets, the Russians would have had no interest in the deal: “It wasn’t the goal to buy the Wyoming mines. The goal was to acquire the Kazakh assets, which are very good,” Novikov, the Rosatom spokesman, said in an interview.

Amid this influx of Uranium One-connected money, Bill Clinton was invited to speak in Moscow in June 2010, the same month Rosatom struck its deal for a majority stake in Uranium One.

The $500,000 fee – among Clinton’s highest – was paid by Renaissance Capital, a Russian investment bank with ties to the Kremlin that has invited world leaders, including Tony Blair, the former British prime minister, to speak at its annual investor conference.

Renaissance Capital analysts talked up Uranium One’s stock, assigning it a “buy” rating and saying in a July 2010 research report that it was “the best play” in the uranium markets. In addition, Renaissance Capital turned up that same year as a major donor, along with Telfer and Giustra, to a small medical charity in Colorado run by a friend of Giustra’s. In a newsletter to supporters, the friend credited Giustra with helping get donations from “businesses around the world.”

A Renaissance Capital representative would not comment on the genesis of Clinton’s speech to an audience that included leading Russian officials or on whether it was connected to the Rosatom deal. According to a Russian government news service, Putin personally thanked Clinton for speaking.

A person with knowledge of the Clinton Foundation’s fundraising operation, who requested anonymity to speak candidly about it, said that for many people, the hope is that money will in fact buy influence: “Why do you think they are doing it – because they love them?” But whether it actually does is another question. And in this case, there were broader geopolitical pressures that likely came into play as the United States considered whether to approve the Rosatom-Uranium One deal.

I hate to see a foreign government own mining rights here in the United States. I don’t think that should happen

Diplomatic Considerations

If doing business with Rosatom was good for those involved with the Uranium One deal, engaging with Russia was also a priority of the incoming Obama administration, which was hoping for a new era of cooperation as Putin relinquished the presidency – if only for a term – to Dmitry Medvedev.

“The assumption was we could engage Russia to further core U.S. national security interests,” said McFaul, the former ambassador.

It started out well. The two countries made progress on nuclear proliferation issues, and expanded use of Russian territory to resupply U.S. forces in Afghanistan. Keeping Iran from obtaining a nuclear weapon was among the United States’ top priorities, and in June 2010 Russia signed off on a U.N. resolution imposing tough new sanctions on that country.

Two months later, the deal giving ARMZ a controlling stake in Uranium One was submitted to the Committee on Foreign Investment in the United States for review. Because of the secrecy surrounding the process, it is hard to know whether the participants weighed the desire to improve bilateral relations against the potential risks of allowing the Russian government to control over the biggest uranium producer in the United States. The deal was ultimately approved in October, following what two people involved in securing the approval said had been a relatively smooth process.

Not all of the committee’s decisions are personally debated by the agency heads themselves; in less controversial cases, deputy or assistant secretaries may sign off. But experts and former committee members say Russia’s interest in Uranium One and its U.S. uranium reserves seemed to warrant attention at the highest levels.

“This deal had generated press, it had captured the attention of Congress, and it was strategically important,” said Richard Russell, who served on the committee during the George W. Bush administration. “When I was there invariably any one of those conditions would cause this to get pushed way up the chain, and here you had all three.”

And Hillary Clinton brought a reputation for hawkishness to the process; as a senator, she was a vocal critic of the committee’s approval of a deal that would have transferred the management of major U.S. seaports to a company based in the United Arab Emirates, and as a presidential candidate she had advocated legislation to strengthen the process.

The Clinton campaign spokesman, Fallon, said that in general, these matters did not rise to the secretary’s level. He would not comment on whether Clinton had been briefed on the matter, but he gave The Times a statement from the former assistant secretary assigned to the foreign investment committee at the time, Jose Fernandez. While not addressing the specifics of the Uranium One deal, Fernandez said, “Mrs. Clinton never intervened with me on any CFIUS matter.”





By Alain Theriault, April 21, 2015


Consumers will not have to get advice from a representative before buying an insurance product on the web, says Quebec’s financial markets regulator, the Autorité des marchés financiers (AMF). It announced this decision in a report published on April 2.

It took almost three years for the AMF to draw its conclusions based on 20 briefs received during its consultation on online insurance distribution. Its report presents these conclusions in the form of 11 guidelines that will serve as the basis for regulation of this distribution method.

The second guideline has the biggest impact on the industry. It permits providers (insurance distributors) to conclude transactions online. This implies that agent involvement is not needed in online insurance transactions.


All the same, providers must meet certain conditions if they wish to sell their products online without a representative, the regulator notes. Consumers must be able to contact a representative if they wish. The provider must also inform the consumer that it is important to get advice from a representative. Adequate self-assessment tools must also be offered to consumers.

Consumers who buy an insurance product without an advisor’s involvement should have the right to cancel the purchase within a certain period, the AMF recommends. In addition, consumers will enter and transmit their data themselves; no non-certified third-party is involved.

In its report, the AMF underlines that insurance representatives can ensure optimal compliance with obligations that it calls indispensable in insurance distribution via the Internet. For one, an analysis must be done to clearly identify the client’s insurance needs, and the product selected must meet the needs identified. Consumers must be given sufficient information to make a clear and informed decision. They must be able to access advice adapted to the complexity of the product and to their level of knowledge of the insurance sector.

The AMF does not plan to dictate to consumers what means to choose when purchasing an insurance product. The priority is that they receive appropriate advice. Consumers may choose, for their own personal reasons, not to do business with a representative, although they have been informed of the importance of doing so, the regulator writes.

“We present 11 guidelines that aim for a fair balance between orderly development of e-commerce in insurance and public protection,” says AMF CEO Louis Morisset. “It is up to the government to decide whether regulatory amendments must be made to give these guidelines full effect.”

Support for advisor involvement is far from unanimous. Nine briefs, most submitted by the distribution network and self-regulatory bodies, insist that advisors are crucial. Some fear that online sales without representatives will create two classes of insured: those who receive advice and those who do not. Others think that consumers must be protected from themselves.

In the other camp, briefs mainly written by insurers and financial institutions argue that consumers need not consult a representative if they can obtain all the advice they need to make an informed decision online.

Other guidelines

The AMF report also recommends that the provider give the consumer specific information before concluding the contract, such as the provider’s name and contact information, registration with the AMF and how to file a complaint.

The regulator will also ask for other disclosures before concluding a transaction, such as the types of consumers that the product targets and their characteristics, total premiums and expenses, and the name of the insurers with which the representative deals, if applicable.

Furthermore, the AMF recommends that the provider disclose information to consumers in steps and that it ask the consumers whether they have read and understood the information. The regulator also suggests that the information provided to consumers before, during and after the purchase of an insurance product online be written in clear and simple language.

The AMF report states that providers must offer consumers a summary of the information used in the application, along with essential product information. It must then transmit the contract documents to the consumer via the Internet or by regular mail, as the consumer wishes. The provider must ensure that clients’ personal information remains secure at all times, and that it is equipped with reliable and secure systems.

Policy on the use of social media

Sites where insurance is distributed online without a representative must contain disclosures and information required by the Act Respecting the Distribution of Financial Products and Services, and the distributor must make its distribution guide available on the site. It could thus ensure that the consumer has consulted it.

In addition, the provider’s website must not contain any ads on the pages where consumers complete an insurance application. Advertising is permitted during the needs analysis step or after the contract is concluded.

The AMF also recommends that providers adopt policies regarding social media. They must also control the content that they or their representative transmit on social media as part of their insurance offer.


An op-ed worth reading

          From:      Peter Lantos (

Date:       Wednesday , April 22, 2015


“Agent-free online insurance sales given greenlight  in Quebec”


This is now official in Quebec.Rest assured that all companies across Ontario and Canada will eagerly be watching, evaluating and rubbing their hands together to expand this scenario into other  provinces!


Despite all the rhetoric from the CEOs, insurance companies dislike insurance agents and advisors. They view us as a necessary cost of doing business (for now). And the sooner they can do business “Agent­ free” the larger their profits will be (so they think) . When is the last time any of your clients woke up in the morning and felt like buying a $IM life insurance  policy?


Is this the beginning of the end of the career agency, independent insurance broker and financial advisor?

And of course, in the meantime , brokers and advisors with 25+ years of expertise and expertise are constantly be bombarded with new compl iance requirements while these companies are allowed to sell direct to the consumer “Agent-free” . Who will look after the best interests of these consumers and protect them during times of dispute?




MARCH 2015


This is a story about capitalism. It’s a system I love because of the successes and opportunities it’s afforded me and millions of others.

0:22 I started in my 20s trading commodities, cotton in particular, in the pits, and if there was ever a free market free-for-all, this was it, where men wearing ties but acting like gladiators fought literally and physically for a profit.


0:40 Fortunately, I was good enough that by the time I was 30, I was able to move into the upstairs world of money management, where I spent the next three decades as a global macro trader. And over that time, I’ve seen a lot of crazy things in the markets, and I’ve traded a lot of crazy manias. And unfortunately, I’m sad to report that right now we might be in the grips of one of the most disastrous, certainly of my career, and one consistent takeaway is manias never end well.


1:11 Now, over the past 50 years, we as a society have come to view our companies and corporations in a very narrow, almost monomaniacal fashion with regard to how we value them, and we have put so much emphasis on profits, on short-term quarterly earnings and share prices, at the exclusion of all else. It’s like we’ve ripped the humanity out of our companies. Now, we don’t do that — conveniently reduce something to a set of numbers that you can play with like Lego toys — we don’t do that in our individual life. We don’t treat somebody or value them based on their monthly income or their credit score, but we have this double standard when it comes to the way that we value our businesses, and you know what? It’s threatening the very underpinnings of our society. And here’s how you’ll see.


2:10 This chart is corporate profit margins going back 40 years as a percentage of revenues, and you can see that we’re at a 40-year high of 12.5 percent. Now, hooray if you’re a shareholder, but if you’re the other side of that, and you’re the average American worker, then you can see it’s not such a good thing. [“U.S. Share of Income Going to Labor vs. CEO-to-Worker Compensation Ratio”]


2:36 Now, higher profit margins do not increase societal wealth. What they actually do is they exacerbate income inequality, and that’s not a good thing. But intuitively, that makes sense, right? Because if the top 10 percent of American families own 90 percent of the stocks, as they take a greater share of corporate profits, then there’s less wealth left for the rest of society.


3:02 Again, income inequality is not a good thing. This next chart, made by The Equality Trust, shows 21 countries from Austria to Japan to New Zealand. On the horizontal axis is income inequality. The further to the right you go, the greater the income inequality. On the vertical axis are nine social and health metrics. The more you go up that, the worse the problems are, and those metrics include life expectancy, teenage pregnancy, literacy, social mobility, just to name a few. Now, those of you in the audience who are Americans may wonder, well, where does the United States rank? Where does it lie on that chart? And guess what? We’re literally off the chart. Yes, that’s us, with the greatest income inequality and the greatest social problems, according to those metrics.


3:53 Now, here’s a macro forecast that’s easy to make, and that’s, that gap between the wealthiest and the poorest, it will get closed. History always does it. It typically happens in one of three ways: either through revolution, higher taxes, or wars. None of those are on my bucket list. (Laughter)


4:15 Now, there’s another way to do it, and that’s by increasing justness in corporate behavior, but the way that we’re operating right now, that would require a tremendous change in behavior, and like an addict trying to kick a habit, the first step is to acknowledge that you have a problem. And let me just say, this profits mania that we’re on is so deeply entrenched that we don’t even realize how we’re harming society. Here’s a small but startling example of exactly how we’re doing that: this chart shows corporate giving as a percentage of profits, not revenues, over the last 30 years. Juxtapose that to the earlier chart of corporate profit margins, and I ask you, does that feel right?


5:07 In all fairness, when I started writing this, I thought, “Oh wow, what does my company, what does Tudor do?” And I realized we give one percent of corporate profits to charity every year. And I’m supposed to be a philanthropist. When I realized that, I literally wanted to throw up. But the point is, this mania is so deeply entrenched that well-intentioned people like myself don’t even realize that we’re part of it.


5:38 Now, we’re not going to change corporate behavior by simply increasing corporate philanthropy or charitable contributions. And oh, by the way, we’ve since quadrupled that, but — (Applause) — Please. But we can do it by driving more just behavior. And one way to do it is actually trusting the system that got us here in the first place, and that’s the free market system. About a year ago, some friends of mine and I started a not-for-profit called Just Capital. Its mission is very simple: to help companies and corporations learn how to operate in a more just fashion by using the public’s input to define exactly what the criteria are for just corporate behavior. Now, right now, there’s no widely accepted standard that a company or corporation can follow, and that’s where Just Capital comes in, because beginning this year and every year we’ll be conducting a nationwide survey of a representative sample of 20,000 Americans to find out exactly what they think are the criteria for justness in corporate behavior. Now, this is a model that’s going to start in the United States but can be expanded anywhere around the globe, and maybe we’ll find out that the most important thing for the public is that we create living wage jobs, or make healthy products, or help, not harm, the environment. At Just Capital, we don’t know, and it’s not for us to decide. We’re but messengers, but we have 100 percent confidence and faith in the American public to get it right. So we’ll release the findings this September for the first time, and then next year, we’ll poll again, and we’ll take the additive step this time of ranking the 1,000 largest U.S. companies to number one to number 1,000 and everything in between. We’re calling it the Just Index, and remember, we’re an independent not-for-profit with no bias, and we will be giving the American public a voice. And maybe over time, we’ll find out that as people come to know which companies are the most just, human and economic resources will be driven towards them, and they’ll become the most prosperous and help our country be the most prosperous.


8:06 Now, capitalism has been responsible for every major innovation that’s made this world a more inspiring and wonderful place to live in. Capitalism has to be based on justice. It has to be, and now more than ever, with economic divisions growing wider every day. It’s estimated that 47 percent of American workers can be displaced in the next 20 years. I’m not against progress. I want the driverless car and the jet pack just like everyone else. But I’m pleading for recognition that with increased wealth and profits has to come greater corporate social responsibility.


8:48 “If justice is removed,” said Adam Smith, the father of capitalism, “the great, the immense fabric of human society must in a moment crumble into atoms.”


9:04 Now, when I was young, and there was a problem, my mama used to always sigh and shake her head and say, “Have mercy, have mercy.” Now’s not the time for us, for the rest of us to show them mercy. The time is now for us to show them fairness, and we can do that, you and I, by starting where we work, in the businesses that we operate in. And when we put justness on par with profits, we’ll get the most wonderful thing in all the world. We’ll take back our humanity.


9:42 Thank you.

9:45 (Applause)

TED is a nonprofit devoted to spreading ideas, usually in the form of short, powerful talks (18 minutes or less). TED began in 1984 as a conference where Technology, Entertainment and Design converged, and today covers almost all topics — from science to business to global issues — in more than 100 languages. Meanwhile, independently run TEDx events help share ideas in communities around the world.

























Andrew Coyne: The real scandal is what politicians can get away with legally

Andrew Coyne, National Post

April 11, 2015


It is a fascinating case Mike Duffy’s lawyer is attempting to present in that Ottawa courtroom. The senator could not have broken Senate rules on spending because there are no Senate rules on spending. “Senate business” is whatever business a senator does. A senator’s primary residence is wherever he says it is.

His driver’s licence may be from Ontario, his health card may be from Ontario, he may pay his taxes in Ontario, the house in Prince Edward Island he supposedly lives in may not even be winterized, but if he says he’s from P.E.I., he’s from P.E.I., and is entitled to claim a monthly allowance for expenses incurred “travelling” to and from the house in suburban Ottawa he has inhabited for many years. Because the rules don’t explicitly say that he can’t, and nobody else in the Senate’s apparently deserted corridors told him he couldn’t. I was just following disorders.

Whether this will allow Duffy to escape jail we shall see. It certainly can’t have helped in the court of public opinion: even by the impossibly lax standards of the Senate (about which the auditor general will inform us later this spring) he seems to have set new records. What his defence has gone a long way to establish, however, is how much of what the senator was up to was the product of a broader political culture. Indeed it was arguably a part of his job description.

I don’t mean the housing stuff, or hiring a contractor allegedly to funnel money to suppliers of various personal services, or the whole matter of the $90,000 cheque from Nigel Wright. But it is clear the senator spent relatively little time doing the people’s business, compared to the vast amounts of time he put in doing the party’s business, making speeches, attending fundraisers and the like, in cities and towns across the country, much of it on the public dime.

And he did so, what is more, with the express approval of his political bosses. When Stephen Harper signed his photo with a hearty shout-out to “one of my best, hardest-working appointments,” he wasn’t referring to the exacting scrutiny Sen. Duffy was giving his legislation in the chamber of sober second thought. One can imagine, then, the senator’s distaste for the kind of hypocrisy that would single him out for punishment.

Whether or not doing partisan work at public expense was against the Senate’s non-existent rules would seem to be a secondary question. If it isn’t, it should be; so far as the rules do allow it, it shows the problem is much worse than one errant senator. The habit of parties helping themselves to the public’s money is deeply ingrained, and one that none of them seems to feel the slightest shame over.

It is instructive that even as we are discussing the improper use of taxpayer dollars for political purposes in the Senate, a similar controversy is unfolding, in another place: specifically, over the government’s use of public funds to pay for government advertising — a $7.5 million post-budget buy, 10 times as much in fiscal 2014, a half-billion over the last five years. Ostensibly, as government ministers maintain, straight-faced, this is to help Canadians take full advantage of the programs available.

But no one is fooled, because everyone has seen this before. That’s what the Conservatives rely on: when called out on it by the Liberals, in particular, the standard-drill Tory response is to roll their eyes and guffaw at the irony of Liberals, of all people, asking about abuse of government advertising. Message: if they did it, so can we. Unintended message: when it comes to ethics, we’re no better than the Chrétien Liberals.

Meanwhile, yet another controversy drags on, this one between the Liberals and the New Democratic Party, over the latter’s maintenance of “satellite offices,” using  its parliamentary allotment, in ridings far from Parliament Hill. The issue turns on the kind of arcane distinctions in which the parties like to seek refuge — what’s parliamentary politics, as opposed to constituency politics — but at bottom it’s the same thing: using public dollars for partisan purposes.


Christie Blatchford: Former Senate law clerk gives Duffy trial a lesson in honour



Christie Blatchford 

April 10, 2015


OTTAWA — What Mark Audcent did for the Senate this week was almost unimaginable: He put a little of the H back in honourable.

The former law clerk for the Red Chamber testified for three days at the fraud, bribery and breach-of-trust trial of the suspended senator Mike Duffy.

Duffy is pleading not guilty to 31 counts and of course could end up being fully acquitted by Ontario Court Judge Charles Vaillancourt.

Yet the grimy details of the charges alone, the conduct underlying at least some of which is not disputed, have dirtied an institution already properly regarded with contempt by many Canadians.

Among other things, on the day after he was named to the Senate in December of 2008 by Prime Minister Stephen Harper, Duffy began claiming expenses for living in his own Ottawa house as though he had not lived and worked in the capital for decades, and was actually coming there from Prince Edward Island, the province where he was born and which he was appointed to represent.

His defence isn’t that he didn’t do this — the per diem claim forms in evidence show he did — but rather that because of the unfettered licence to bill that senators give themselves, it wasn’t even wrong, let alone criminal.

In other words, even in week one, it’s clear that regardless of outcome, this trial most days may leave everyone wanting a good shower.

Enter Audcent, who retired last year after 32 years in the Senate, 17 as the Senate law clerk and parliamentary counsel.

A lawyer by training, his dealings with individual senators protected by solicitor-client privilege, and I suspect naturally discreet, Audcent was always erudite and careful in his answers.

But there were glimpses here and there that revealed how very much he believes in genuine public service and how dear to his heart are the noble traditions of the “Honourable Chamber.”

When, for instance, he was asked Friday by prosecutor Mark Holmes in re-examination about the “honour principle,” which is the presumption that senators will act honourably, Audcent said, “I think it applies to everyone…. We’re all expected, wherever we work, to be honest and we’re expected to be decent.”

That presumption, he said, “infused the Senate throughout much of my career … but now we’re getting into a world of controls and checks.” It’s a more bureaucratic, administrative planet, he said, harkening back to something he mentioned earlier, about the Charter of Rights ushering in a sort of “show me” mentality, where citizens want to be pointed to various rules or procedures.

Still, he said, even now, “there’s a cultural presumption within the institution” of the Senate that its members will do the right thing and can be trusted, and, he added, there’s “a culture of respect of senators” too.

“I mean,” he said, “they are senators of Canada.”

Holmes asked if he thought the “principles of public life” — integrity, accountability, honesty and transparency — provided any sort of fetter upon senatorial conduct.

Audcent said: “I’m not sure I see it as a fetter, but it feeds the action of public life in the Senate. This is what’s expected of everyone in public life.”

He isn’t naïve. He appreciates full well the inherently partisan nature of the Senate, as was best illustrated in his interpretation of a Jan. 6, 2009 letter Duffy and Pamela Wallin, another senator-in-trouble, received from a policy advisor named Christopher McCreery, who then worked for Senator Marjory LeBreton, at the time the government leader in the Senate.

The letter basically told the two then-rookie senators not to worry about whether they actually lived respectively in P.E.I. and Saskatchewan because the Senate had never disqualified a senator because of residency, even if they lived “in Ottawa 99% of the time.”

Upon reflection, Audcent said, it was clear to him that McCreery was saying look, “the way the politics is gonna work is that as long as you own property (in the provinces you represent), your qualification is not going to be challenged in the Senate…. It’s not a legal opinion, it’s a political one.”

At the end of his testimony, Holmes having wrapped up a mercifully brief re-examination, Audcent asked if he might be permitted to speak for a minute.

For a second, in the courtroom, reportorial hearts soared: Was there a bombshell coming?

But no, Audcent said he hoped he might be able to shed some light on what the terms “public business,” “official business” and “parliamentary functions” mean.

And then he delivered a wee history lesson, running through it the moral code of an honourable man, that was a reminder of all the good that lies beneath the sheen of scum on Ottawa waters — everything, as an old friend reminded me, from the rule of law to the essential fairness of Parliament, and those like Mark Audcent, defending in his way as Cpl. Nathan Cirillo did in his, what is so good about this country.

National Post


Obama admits 13 years from now Iran could build a bomb right away. Republicans livid


Josh Lederman, Associated Press 

April 7, 2015 


WASHINGTON — Iran could have the capabilities to build a nuclear bomb almost immediately after the first 13 years of the emerging nuclear deal, President Barack Obama acknowledged on Tuesday. The Republican leader of the U.S. House reacted tersely, arguing that Obama had just confirmed what critics of the deal have long feared.


Under the framework for a final deal, Iran would be kept at least a year away from a bomb for the first decade, Obama said, as he pressed ahead in his campaign to sell the deal to skeptics. Pushing back on criticism that the deal allows Iran to keep enriching uranium, Obama told NPR News that enrichment isn’t the prime concern because Iran will be capped for a decade at 300 kilograms — not enough to convert to a stockpile of weapons-grade material.


“What is a more relevant fear would be that in Year 13, 14, 15, they have advanced centrifuges that enrich uranium fairly rapidly, and at that point, the breakout times would have shrunk almost down to zero,” Obama said.


Breakout time refers to how long it would take to build a bomb if Iran decided to pursue one full-bore — in other words, how long the rest of the world would have to stop it. The framework deal expands Iran’s breakout time — currently two to three months — to at least a year.


Yet that constraint would stay in place only for 10 years, at which point some restrictions would start phasing out.


House Speaker John Boehner said Tehran was taking the long view and cautioned that the Iranian regime could exploit the easing of restrictions to fulfil its ambitions of exporting revolution across the globe.


“It is clear that this ’deal’ is a direct threat to peace and security of the region and the world,” Boehner said. Considering Iran’s history of evading international inspections, he added, “no one should believe that the proposed inspection and verification are bullet-proof.”


The tough talk from Boehner suggested congressional leaders were continuing to sour on the framework deal that Obama and world leaders reached with Iran last week in Switzerland. Previously, Boehner had expressed serious concerns about the deal’s parameters, but withheld full judgment until lawmakers had time to digest all the details.


Other top lawmakers, including some members of Obama’s party, have been pressing for Congress to hold a vote on whether to approve the deal — a prospect Obama has rejected outright. Senate Foreign Relations Chairman Bob Corker, a Republican, is pushing legislation that would also prevent Obama from using his own authority to temporarily waive existing U.S. sanctions while Congress debates the deal.


The option of a future president to take action if in fact they try to obtain a nuclear weapon is undiminished.


Although Obama acknowledged in the interview that Iran’s breakout time could shrink after 13 or 14 years, he said at least the world would have better insight into Iran’s capabilities because of extensive inspections in the earlier years.


“The option of a future president to take action if in fact they try to obtain a nuclear weapon is undiminished,” Obama said.


The stark admission came as the president seeks to quiet a growing chorus questioning whether the deal he and world leaders have negotiated merely delays the certainty of a nuclear-armed Iran. Obama has insisted confidently that Iran will not get a nuclear weapon on his watch, which ends in roughly 20 months, but has made no similar assurances about his successors.


Tehran has always maintained it doesn’t want a nuclear bomb, but the international community has been skeptical, and America’s close ally Israel considers a nuclear Iran an existential threat. U.S. lawmakers and foreign policy hawks have questioned how Obama can strike a diplomatic deal with a country that continues to threaten Israel and tops the U.S. list of state sponsors of terror.


Obama, who is also working to restore ties to longtime U.S. foe Cuba, has suggested cautiously in the past that a nuclear agreement could be a precursor to Iran pursuing a more amicable relationship with the world community. But in the days since the framework deal was announced in Switzerland, his administration has sought to emphasize that the deal relies on inspections, not trust, and is worthwhile even if the Iranian regime remains venomously anti-American.


“I think there are hard-liners inside of Iran that think it is the right thing to do to oppose us, to seek to destroy Israel, to cause havoc in places like Syria or Yemen or Lebanon,” Obama said. “If they don’t change at all, we’re still better off having the deal.”







Lawrence Summers comes out swinging for Keystone XL pipeline at Rotman talk


Barbara Shecter 

April 6, 2015

Financial Post 


If it were up to Lawrence Summers, the former U.S. treasury secretary who also served as chief economist at the World Bank, the United States would approve the controversial Keystone XL pipeline.

In fact, Canada’s largest trading partner should already have done so, Mr. Summers told a crowd at the University of Toronto’s Rotman School of Management on Monday.

“I do not speak for us, I speak for me. I wish we already had” approved the pipeline, Mr. Summers told his audience, adding that the United States should give a green light to the pipeline based on considerations such as the country’s energy needs and the importance of its ally, Canada.

Shipping oil by rail is a “dangerous” activity that dates back to the 20th century – and not even the last part of it, he said, noting the potential for accidents and environmental damage.

Still, he said Canada ”could have made it easier for the U.S. to approve Keystone,” in part by showing “more concern” around the potential environmental opposition and climate change arguments when shipping fossil fuel into another country.

Canadian Prime Minster Stephen Harper has taken an aggressive approach on Keystone, famously calling the project “a no-brainer” in 2011, and then further saying Canada “won’t take no for an answer” on the controversial pipeline project.

“Whatever you did, we should’ve approved Keystone,” concluded Mr. Summers on Monday, to murmurs of approval from the audience of business students and Rotman elite. He added that allowing construction of the pipeline is “the right answer.”

The U.S. State Department is conducting a review of the TransCanada Corp. project that would carry Alberta’s crude oil into the United States. U.S. President Barack Obama has repeatedly thwarted attempts to get approval for building the US$8-billion pipeline before that review is complete.

Just last month, the U.S. Senate failed to override Mr. Obama’s most recent veto of a bill that would have approved the pipeline.

Mr. Summers’ remarks at the business school were largely focused on technology and infrastructure, two necessary ingredients for what he called “inclusive” economic prosperity.

The Harvard University professor, who also served as the Ivy League school’s president, said the issues are very different from the 1980s and 1990s. Inflation is not on anyone’s radar these days, he noted, and even bonds in North America, Japan, and Europe indicate there will be no upward movement in prices for decades.

Rather than focus on monetary stimulus, He urged governments and policy makers to focus on infrastructure development, including “bricks and mortar” projects such as bridges and roads, and information technology for schools. This would create jobs and stimulate much-needed demand in the economy, he said.

There are practical implications as well, in that low-interest-rate debt is a better legacy to pass to future generations than ongoing maintenance requirements for airports, he said.

Mr. Summers praised Canada for the country’s policies on immigration, which he suggested would help the economy going forward. The United States has “a lot to learn from Canada. You have done it better than most,” Mr. Summers said.

The U.S. ambassador to Canada concludes the first year of his posting acutely aware that a single irritant over an oil pipeline has grabbed so much of the attention in the Canada-U.S. relationship.

He has not been holding back recently on criticism of his own country. In a Financial Times column this week, Mr. Summers chastised the United States for allowing political pressure from all sides to render the country “increasingly dysfunctional” as a global powerhouse.

A tangible result, he said, is that China is establishing a major new institution, the Asian Infrastructure Investment Bank, with many traditional allies of the United States.

Mr. Summers packed the hall at Rotman with an audience eager to hear advice from a man whose wide-ranging career has not been without controversy.

Less than a decade before the global financial crisis, when Mr. Summers was deputy treasury secretary, a 1999 Time magazine cover heralded him as part of a trio of economic heavyweights dubbed The Committee to Save the World. The others on the magazine’s cover were then Federal Reserve Chair Alan Greenspan and Robert Rubin, who was treasury secretary at that time.

In the fall of 2008, Mr. Greenspan acknowledged to the U.S. House Oversight Committee that he had made “a mistake” in his hands-off regulatory policy and in presuming the ability of the country’s banks to assess risk, and their self-interest, would protect the financial system from excesses.

Financial Post





A God? That’s complicated. Canadians hanging on to personal faith as organized religion declines: poll @nationalpost