From The Desk of Alan Blanes,
Alan who is the lead Canadian contact for the Public Banking Institute and a member of the Council of Canadians continues to question the absence of justice and the rule of law in our financial regulatory systems. See below.
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To the attention of Heather Wood:
cc Hon. Carole James, Hon. David Eby, Hon Mike Farnworth, and MLAs
Heather, we live in a democracy. This is presumed to be a political system where accountable reasons are provided for politically decided policy. Your letter addresses none of the issues associated with an investment company in BC claiming to have GICs which it is pledging to hold in trust for Harold C. Blanes, in a document signed by the client and the Investors Group salesperson and the Regional Director of Investors Group - Mr. Paul Demay - occurring on or about March 15, 2007. Issues surrounding the fact that the company was delinquent with the Office of the Superintendent of Financial Institutions [OSFI] and therefore was not authorized to offer the holding of GICs for clients, made this offer unlawful and undeliverable. This status of Investors Group as not being current in its corporate returns for its GIC Division "Investors Group Trust Company Limited" remained until February of 2014, when it re-registered with the OSFI. Harold Blanes utterly rejects all assertions that this signing of this undertaking had anything other than an intent to deceive. The contract document also involved the providing of the drivers' licenses of the client and the consultant. It was not just a fanciful 'possibility of what kinds of securities may at some point in time be offered'. There is no reasonable way that such fluff could be read into the March 15, 2007 agreement. It says the Investors Group Trust Company Limited would hold GICs in trust for Harold Blanes. No "maybes" and "possible future range of various products". It is incredible that anyone is being asked to believe such a canard of an interpretation. The Ministry of Finance should not be so naive. This document signed by Harold Blanes on or about March 15, 2007 should be seen squarely for what it was: a creation of fiction with one purpose: to mislead the client into thinking he was being signed up for GICs. How could you try to excuse such a dishonest ploy? How could you rationalize someone who at the time of his being 86 years of age, would have to forfeit the enjoyment of retirement years having to fight and put up legal expenses over something this illegitimate? There are egregious aspects to what this company did. For one thing - while Harold Blanes was in a coma at the Kelowna General Hospital in February/March 2007, the company - without knowledge or consent racheted up his risk tolerance to "high". No regulator to this date ever questioned any of these outrageous acts.
Harold Blanes - a 97 year old World War Two Veteran - who put his life on the line in June of 1944 on Juno Beach, Normandy, for Canada to have honest and accountable governance - is becoming profoundly worried that the impunity that is being provided to Investors Group in its fraudulent misrepresentations, is setting an intolerable precedent. This company is being allowed to avoid having to explain why it provided misleading documents for the signature of the client - when it had no intention or capacity to "hold GICs in trust". Harold Blanes rejects the notion that an investment company may freely engage in the hijacking of $414,000 of his savings - which he had been led to believe would be providing him with 4% interest for a 2 year GIC. Later findings indicate that there was more that one check mark on the "Time Horizon" line of this contract, and the box that would have been required for a seven year holding - was left blank. No "compliance officer" had scrutinized this record - which would have clearly required explanation - and a verification determined of what exactly what were the intentions of the client. None of this happened - and there is ZERO evidence that the IIROC Rule 2500 was ever carried out - that requires another staff person to check with the client when a new account is opened - to determine if the client is holding what they are told they are holding. IF THIS RULE WERE TREATED SERIOUSLY BY REGULATORS - ALL OF HAROLD BLANES' ISSUES WOULD HAVE BEEN CAUGHT, AND THIS WOULD HAVE BEEN MANAGED APPROPRIATELY WHEN IT WAS ORIGINATING.
Instead, the IIROC paid no attention that its rule was ignored. The BC Securities Commission had not paid any attention to the fact that this procedure was absent in Harold Blanes' file. Instead he had been subjected to a decade of inexcusable torment and trauma. He has been left to have to experience an other-worldly level of abandonment and despair. Clearly, the regulation of the sale of GICs under false pretences is not treated as a serious matter in BC, and therefore it is going to be a priority of Harold Blanes in his latter years, to encourage that an independent verification process be organized by groups that have actually worked in previous years to protect our democratic institutions as honest, good-faith providers of services. The Royal Canadian Legion is a possible organization that may be able to invite interested members to begin to research what would be involved in achieving a public role for account verification.
This is a realistic way to engage the clients of investment companies in the process of making sure that there is authentic checking with clients to determine their holdings.
A British report on engaging the public in securities regulation:
Harold Blanes is not making up his complaint, and I was a witness to much of the representations that were made to him by this company. It has become an example of deliberate corrupt practice, that Harold Blanes has been told to use the Insurance Council of BC as the venue for his grievance. This would only have been appropriate - if and only if - he had chosen to contract for risk based insurance products. The regulatory apparatus has been acting disingenuously in expecting him to go to the wrong agency - and then to experience being told that his complaint has no merit. Noam Chomsky has written about mangling the concerns of complainants - and then dismissing the grievances as having no relevance. The Government of BC should be above such a cynical elder abuse practice.
Last year, Harold Blanes met with Brian Dillon of the Ministry of Finance Policy office. Mr. Dillon stated that there was going to be a review of the financial institutions that come under the Ministry of Finance of BC, and I would like to find out if this review process had commenced. The links to the backgrounders provided by Brian Dillon:
Mr. Alan Blanes:
Thank you for your phone call. As discussed, I have booked a boardroom for us to meet on Monday August 29 at 1:30 pm. The building is secured and there is no reception, so we will need to meet in the Lobby of my building, at 617 Government Street. Please see the detailed note on meeting location below.
If you need to adjust the time, please let me know as my schedule so far is very flexible.
As mentioned, the government has commenced a review of its financial institutions legislation (including the province’s regulatory framework for insurance companies, insurance agents and trust companies). Here are links to the discussion paper released last year and the paper summarizing the responses received during the consultation period:
I should note that this review does not encompass any matters relating to the administration of justice, such as court fees and costs. This is the responsibility of the Ministry of Justice.
I am looking forward to meeting you and your father on Monday.
Regards,
Brian
Brian Dillon
Financial and Corporate Sector Policy Branch
Ministry of Finance
Room 012
617 Government Street
Victoria BC V8V 1X4
Mailing address:
PO Box 9418 Stn Prov Govt
Victoria BC V8W 9V1
Ph: 250-356-0539
Fax: 250-387-9093
NOTE: My offices are at 617 Government Street, across the street from the Legislative Buildings. Take the main entrance up the steps on Government Street, which will lead you to the main lobby on the first floor where you will have to call me (my phone is 356-0539; if I am not there, press 0 and the call will go to our assistant) as the doors are locked from that lobby into offices.
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More to come
