A Funny Thing Happened On The Way To Ottawa...

A Funny Thing Happened On The Way To Ottawa...
Posted on April 21, 2016 | Larry Elford | Written on April 21, 2016
Letter type:

Author's Note:

Author's Note:

My work involves coaching Canadians about investment best-practices, and giving fair warning to consumers when the average investment ‘advisor’ is not a truly licensed ‘adviser’ (note the important spelling difference).  Most often investors are lured by the promise of trusted financial experts, and then delivered a salesperson representing the interests of the dealer.  This secret bait and switch should not be concealed from the public.


It’s remarkable that this information is actually noted on each ‘advisor's’ license, yet it is concealed from investors, by just over 99% of them.


I began an online journey to bring this to the attention of our government in Ottawa.  It is hoped that the extent of this consumer bait and switch might compel legislators to consider an investment protection system beyond our current dual-master regulatory regime in Canada.  Serving two masters is proving to be a failure for our provincial regulators, and I believe it is time to separate the roles of industry interests and investor interests.


The YouTube video link attached shows in 1 minute 39 seconds how this deception is hidden by investment dealers and provincial regulators. It is not fair or honest to consumers to allow the most important piece of information about who is handling your money, to be concealed.

Author's Video Note:

Securities Commission Deception Tour…

Update June 28, 2016
One, out of 716  financial or investment "advisors", license-checked, found to hold the proper registration. Only one...

To get to the above number of 716, I focused today on searching in the BC community of Surrey.

I am taking a slightly different search approach in June, while wondering why the Alberta Securities Commission is dilligently ignoring violations of both the Alberta Securities Act (Sec 75 and Sec 100 on "representation" and "holding out" of title) and of violations of the trust of Alberta investors.  Why would the ASC ignore the law, to benefit ONLY commission investment salespeople?

I picked ONE major investment dealer, who nationwide handles the financial affairs for millions of Canadians.  I then found the list for EVERY registrant within that investment firm, in Alberta.  See the video below to find out how to search yourself, if you wish to check whther your "advisor" is licensed.

In searching around 300 names this month, I found this result:  ZERO out of those 300 (in Alberta) held the license of an "advisor", "Adviser", or an "Advising Representative".

None.  not one as required by the law of the Alberta Securities Act.

I did find ONE member of this firm who was licensed as a "dealing rep" and also licensed as a "compliance officer".  The irony of discovering this was that a compliance officer would be the person repsonsible for compliance with laws, rules and codes of conduct.  The irony speaks more than mere words, to find the complaince officer allowing an entire investment firm to be fooling clients.   


Update May 31, 2016

 Zero licensed advisors found while searching in Red Deer Alberta.  None.  Not one.  I searched 48 people who adverstise themselves as investment "advisors", which I believe is just under half of those who may operate in Red Deer. 

Securities Commission Deception Tour 

On May 31, 2016, I searched 48 people who advertise themselves as investment advisors in Red Deer, Alberta. I believe this number is just under half of those who may operate there. I found zero licensed advisors in Red Deer. None. Not one. 

Total ‘advisors’ searched to date in Canada = 403 

Total of properly licensed persons found = ONE — in Edmonton.

Canada’s most trusted investment dealers conceal commission sales licenses.  Provincial Securities Commissions allow the deception.  Illegal?  Yes.  

Allowed?  Yes.  

Ask your MLA why your securities commission allows deception and ignores the required registration disclosure found in each provincial Securities Act. 

Full disclosure: I am not a current or former member of the Federal Liberal Party, but I do applaud the foresight of its members in seeing this issue. A number of local Liberal Party members became interested in how Canadians end up financially abused by trusted financial professionals. They have worked diligently to take the issue to Ottawa, and to ask for sound and professional protection of Canadians’ retirement and investment savings. After learning how most financial sellers merely pose as financial professionals, violating rules, laws and principles in order to do so, the Party drafted one of the best investor protection policies I have seen in more than a decade.  The policy is attached to this post. Other parties have so far preserved the corporate status quo, which is currently tilted in the opposite interests of the consumer.  


It is April, and the Liberal Party Policy convention in Winnipeg occurs in May.  I will start in an easterly direction from my home in Alberta, and journey through as many communities along the TransCanada Highway as I can cover.

For each community I intend to search the Canadian Securities Administrators (CSA) website http://aretheyregistered.ca   checking the license and registration category of those who proclaim ‘advisor’ status under Canadian law.

First stop, my home town of Lethbridge Alberta, where I looked up the license/registration category for approximately 60 financial firm employees who advertise they are ‘advisors.’

Of the 60 searched, not one single person held that category of license/registration as required by law.  Each was using something known in the business as "title inflation" in order to avoid having to tell clients the truth, which is that they are registered in the salesperson category, officially titled "Dealing Representative" (salesperson).

This is a form of deception I call ‘Advisor Fraud.’ It looks something like affinity fraud (fraud by a member of an organization you belong to).  

"Affinity fraud bypasses the natural distrust we have for schemes promoted by strangers..." (Investment Coach Todd Tressider)

Advisor Fraud, in a similar manner, bypasses the natural distrust we have for schemes promoted by salespersons.  So the instinctual reaction of an investment selling industry is to deceive investors with a bit of title magic.  ABRA CADABRA!

In the industry, a "dealing representative" represents the interests of the dealer, while an "advising representative" is required by law to represent solely the interests of the investor and NONE OTHER.  A dealing representative is considered to be a salesperson, and in fact the legal name of this category was, literally, "salesperson" until it was changed by the CSA in September of 2009.

It is a bit of a ruse, but as you can see from the Lethbridge area license/registry searches, it encompasses approximately 100% of the selling practices of the retail investment side of the business.   

The other side is the investment "advising" side, which is a totally different, higher-standard game.

Next stop heading east along Highway 3 is Medicine Hat, Alberta.  Here I searched 39 persons using either ‘advisor’ or ‘consultant’ as a title. One hundred percent (100%) were licensed in the category of a dealing representative (salesperson),  not in the category of advising representative.

A true cynic would call this fraudulent concealment, but I leave it to readers to judge for themselves.  (There are at least 11 other rules, laws, criminal codes and ethical requirements violated.)

So far I have searched 99, and the number of legitimately licenced advisors (advisers) is ZERO.

These deceptions result in the investment industry earning billions more by overcharging trusting and vulnerable investors, having duped them into a false sense of security by concealing their true license and loyalty.  Do not take my word for this. Read The $25 Billion Dollar Haircut, by University of Toronto pension analyst Dr. Keith Ambachtsheer.


Fast forward 35 years and millions of Canadians will be retiring with half as much money in their retirement accounts, while their false ‘advisors’ and bankers/dealers will have pocketed the other half.  All it takes to do this harm is to charge an extra, nearly invisible, 2%.

The lie, when combined with the covering effects of self-regulation/captured regulation makes getting this 2% as easy as taking candy from a child.  

Arguably, up to eleven (11) of the rules or laws listed on the website Crimes of Persuasion are flaunted daily in an effort to mislead investors in Canada. These are in addition to the financial industry’s violation of its own rules, codes and principles.  http://www.crimes-of-persuasion.com/laws/canada/criminal_laws.htm

Next stop, Swift Current Saskatchewan. On April 23, 2016, I searched 13 investment advisors and found none with anything other than a Dealing Representative (salesperson) license or registration.  Zero had the "Advising Representative" registration, which generally carries the duty to not act as a counterparty to client interests.  In a YouTube video, former TD Bank CEO Ed Clark reveals how his clients were not his clients, they were "counterparties" off whom to make money.   https://youtu.be/23xWWsGp6vU   (from 0:50 to 1:50 min.) 

Note of interest: Banks in Swift Current were seeking to hire investment ‘advisors.’ Their employment description follows. (Also note a May 2016 RBC ad for an investment advisor: #RBC) https://www.linkedin.com/comm/jobs2/view/139349488?refId=d6274911-256e-4... 

City: Swift Current 

Address: Swift Current 

Work Hours/Week: 37.5 

Work Environment: Branch 

Employment Type: Permanent 

Career Level: Experienced Hire/Professional 

Pay Type: Commissioned Sales 

"Experience in a direct marketing role"

"4-6 years of outbound sales experience"

"As an Investment Advisor, you work within a 100% commission compensation structure"

April 24th, 2016: Moose Jaw Saskatchewan. With a population of some 33,000 people I expected perhaps 15 to 20 who claim to be investment advisors, consultants, etc.   Nope.  None.  Using the legal search engine shown in the video above all 12 persons found at the big, trusted firms failed to hold this license or registration category.   That puts the count at ZERO legally licensed advisors found out of 122 searched over 555 kms of travel.

April 25th: Regina, Saskatchewan, population approximately 200,000, with perhaps 100 ‘advisors’ throughout all banks, mutual fund dealers, minor investment dealers and so on.  I was able to search the licence and registration status of 32 ‘advisors’ and found ZERO with an actual license in the category they proclaim.  The total ‘advisors’ now searched is 154 over 624 kilometers WITHOUT FINDING ONE legally registered advisor—not even one spelled "adviser" as found in the Securities Act.  None.  Lying to earn your trust is a bit ironic isn't it.....?

April 27, Saskatoon, Saskatchewan. I checked the licensing of EVERY listed advisor at BMO Nesbitt Wealth Management in #Saskatoon, and found ZERO holding an advisor license. Film at 11.  

Brandon, Manitoba: None

Winnipeg:  Zero found (although I am sure there are some truly licensed fiduciary advisers located here)


WHITE ROCK BC: None found

Nanaimo BC: None found 

As I continue this journey I will update this post, letting Canadians know how many truly registered advisers (or "advisors,” depending upon spelling) I find.

Fairness and honesty would require banks (and securities regulators) to properly inform the public that their investment advisors are salespersons. When I ask provincial securities commissions why they allow banks and others to violate the Securities Act (Ontario Sec 44, Alberta Sec 75, Sec 100, BC, Sec 34, etc.) they go quiet in a rather abrupt manner.  I hope some who read of this will ask their provincial member of the legislature, to demand sole-investor protection for Canadians, and no longer settle for conflicts of interest of the dual-mandate regulator.  It is failing Canada, while making investment dealers "richer than you think..."

To read a previous article on this topic for further background, please visit this link  http://unpublishedottawa.com/letter/53360/big-box-lies-investment-salesp...

Related article: 


Letter Response

DRAFT Resolution on National Investor Protection 


Most Securities regulators in Canada are “self”-regulatory and can use this (the "self" part) to bypass investigation and prosecution of industry wrongs.


The financial industry pays the salaries of the regulatory force, rather than the taxpayer. This means that clever financiers get to choose who to hire to regulate financiers. i.e. hiring your own police


The financial industry pays regulators three to four times more than what they would earn in  similar employ elsewhere;   over-paying makes regulators “compliant” and more willing to say “YES” to the financial industry; In consequence, failing to protect the public.


All thirteen (13) securities commissions, acting in concert will allow any financial institution in the country to be exempt from our Securities laws, simply by completing an application with no public debate and no public notice.


Securities Regulators and Self-regulators in Canada have representation on the RCMP Investigation Units which further allows the investment industry to avoid criminal prosecutions.


That the Government of Canada adopt policy supporting and implementing major changes to the Securities regulatory system in Canada.

Establish a National Investor Protection Agency with the following attributes:

  1. Separating all investment police functions and investigations from the securities commission and the securities industry. A separate, specialized, Securities Crime Police Unit would be formed.

2. The government appointing Protective Regulators representative of the public interest and paid by the taxpayer, not industry.

3. Allowing no exemptions to the law, except in extreme cases where full public discourse and disclosure can show no damage to the investing public by such exemption.

4. Separating the Securities commissions and industry paid regulators from the RCMP Investigation Units and any police agency.

5. Applying and enforcing the Criminal Code for the Financial Industry, rather than allowing “self” regulators to ignore criminal code violations of the investment industry. 

About The Author

elford's picture


Investment Misconduct and Malpractice Analyst

Larry Elford is acclaimed as a qualified expert on the subject of White Collar Crime as it relates to the investment selling industry. He... More