The Reminder is making its archives back to 2003 available on our website. Please note that, due to technical limitations, archive articles are presented without the usual formatting.
"Canada Deposit Insurance Corporation members should improve warnings in the materials they sell rather than waste money making up for their mistakes through media advertisements," says Tom Hockin, President and CEO of The Investment Funds Institute of Canada (IFIC). IFIC has requested that the Canada Deposit Insurance Corporation (CDIC) stop a series of ads targeting mutual funds as an investment not covered by insurance. The newspaper and television ads during RSP season in effect encourage people to invest only in bank accounts and GICs, which now pay some of the lowest returns in modern history. The CDIC is an agency of the federal government. IFIC registered its concern in a letter sent last week to CDIC chair Ron Robertson. See 'Targeting' P.# Con't from P.# "We request that CDIC stop the targeting of mutual funds in its advertising. To achieve retirement and other financial goals, Canadians must be confident in the securities markets. With a balanced portfolio of the right investment mix, long term diversified investing is essential to their success," said Hockin in the letter. "We have received reports of clients and investors calling their financial advisor because of fears created by these ads. Surely this is not a responsible approach by an agency of our federal government." "CDIC insurance needed for deposits is not relevant to mutual funds," added Hockin. His letter points out "You will know that securities held in mutual funds are held in trust by independent trust and custodial companies on behalf of the investor. The financial failure of the selling institution would in no way threaten the ownership or the value of the mutual fund assets held by the client. This fact mitigates the need for any CDIC style of protection.
