Briefly:

(May 7, 2004) Quebec has announced the creation of a $14.6 million investor education fund. The money will be used to support the principles of investor protection, good governance and investor education, says Quebec’s financial services regulator, the Autorité des marchés financiers (AMF).

Similar to Ontario’s model, funding comes from fees and administrative penalties collected by the AMF. A special committee will decide which projects will be financed.

“It is clear that the fund represents a unique way of ensuring the development, vitality and expansion of Quebec’s financial sector,” said Quebec Finance Minister Yves Séguin. “It also encourages the promotion of good management practices and intends to establish high standards of corporate governance.”

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Brompton Group announces new trust offering

(May 7, 2004) The Flaherty & Crumrine Investment Grade Preferred Fund has filed a final prospectus for an initial public offering (IPO) of trust units, the Brompton Group recently announced. The IPO, offered through an investment syndicate led by RBC Capital Markets and CIBC World Markets, is expected to close in mid-May.

The fund’s investment objectives are to provide unitholders with a stable stream of monthly distributions targeted to yield 6.75% a year, based on an original subscription price of $25 per unit. The actively managed portfolio will consist mostly of hybrid preferred securities, Brompton says.

California-based Flaherty & Crumrine will provide investment advice and portfolio management services while Brompton Preferred Management will manage the fund. Toronto-based Brompton manages more than $1 billion in assets.

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Great-West dumps troubled Putnam

(May 6, 2004) Great-West Life has announced it will terminate Putnam Investments as investment sub-advisor as of July 19, 2004. The move comes as Great-West completes its review of the arrangement.

Putnam, which has been investigated as part of the U.S. mutual fund scandal, sub-advises $670 million in Great-West investments. Great-West says it does not believe its investors have been harmed in any way by Putnam’s alleged actions in the U.S.

Replacing Putnam are UBS Global Asset Management on the International Equity Fund; JP Morgan Fleming Asset Management for the International Opportunity Fund; and Brandywine Asset Management on the International Bond Fund.

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Assante funds switch to RBC for services

(May 6, 2004) Assante Asset Management (AAM) has chosen RBC Global Services to provide custody and investment administration services for its funds. These services had been previously provided by State Street.

“Securing RBC Global Services as our provider of custody and administrative services is another example of how we are able to leverage our relationship with CI to enhance the efficiency of our operations and benefit our clients by reducing the operating expenses of the funds,” said Joseph Canavan, president and CEO of AAM.

RBC now services all of CI’s funds, including the CI brand and its Skylon Capital Corp. division.

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Morningstar files to go public

(May 6, 2004) Mutual fund research powerhouse Morningstar Inc. has filed with the Securities and Exchanged Commission in the U.S. to go public. Details of the initial public offering, including the number of shares and the target price, have not been released.

The IPO will be headed by Morgan Stanley, acting as book-running manager, with Deutsche Bank Securities and William Blair & Company as co-managers.

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Clarica offers access to doctors worldwide

(May 5, 2004) Clarica advisors are now offering clients access to 50,000 medical specialists worldwide through the Best Doctors program.

The Best Doctors program allows clients to access medical specialists through a personal advocate to learn more about treatment options for 18 listed medical conditions.

The Best Doctors Service Card is available from a Clarica advisor for $90 a year for individuals or $180 a year for families, and offer unlimited lifetime access to Best Doctors services for as long as the membership is maintained. Clients do not need to purchase any other health insurance products to be eligible for the program.

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CI adopts new ADP technology

(May 4, 2004) CI Mutual Funds has agreed to provide CI prospectuses and amendment documents to dealers through ADP’s Smart Prospectus service.

“ADP’s Smart Prospectus is a solution that benefits investors in our funds by cutting costs and ensuring they receive only the information they need,” said Marcelo Donato, senior vice-president of marketing at CI. “We are also pleased to make it easier for dealers to do business with CI.”

Smart Prospectus was designed to assist dealers in meeting statutory delivery requirements and to replace current manual fulfillment practices.

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Meritas goes after Magna board

(May 4, 2004) Meritas Mutual Funds has joined a call to oust the board of Magna International, announcing it will withhold votes from all current directors. Meritas holds Magna within the Meritas Jantzi Social Index Fund.

“There are two key issues that investors have with Magna. The first is a dual-class share structure that allows Magna’s founder and chair, Frank Stronach, to control just 3.4% of the equity of Magna International Inc. but maintain control over the entire firm due to the multiple votes allotted to these shares,” said Gary Hawton, CEO of Meritas. “The second issue is the level of compensation provided to Mr. Stronach and approved by the board of Magna. In 2003, that compensation amounted to over $36 million US.”

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IDA bans member, levies huge fine

(May 4, 2004) The IDA has issued a lifetime ban and levied a $410,000 fine on Paul Alexander Bishop, for violations while he was a registered representative at various Toronto offices of CFG Financial Group Inc.

“Mr. Bishop acknowledged that he engaged in several instances of conduct unbecoming, contrary to by-law 29.1, in that he misappropriated funds from six clients, issued fictitious account statements to six clients, engaged in unauthorized trading and compensated a client for trading losses without the member firm’s knowledge,” the IDA said in a statement.

Bishop was also ordered to pay the IDA $39,816.25 in costs.

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Goodman offers Institutional Funds

(May 4, 2004) Goodman Institutional Investments announces the launch of Goodman Institutional Funds, offering fund of funds management to small pension funds and a fund of hedge funds to larger pension funds.

Clients pay a fixed percentage fee, based on assets under management and assets will all be managed by external third parties. Clients will be offered two managers per asset class — a growth manager and a value manager.

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Fed leaves rates unchanged

(May 4, 2004) The U.S. Federal Reserve today left its key overnight lending rate unchanged at 1%, a 45-year low. But the Fed slightly adjusted its language in the statement accompanying today’s decision, setting the stage for a gradual interest rate rise, analysts believe.

“At this juncture, with inflation low and resource use slack, the committee believes that policy accommodation can be removed at a pace that is likely to be measured,” the Fed stated.

The Fed also noted that economic output is continuing to expand at a solid rate and that hiring appears to have picked up.

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Altamira offers Monthly Income

(May 3, 2004) Altamira Investment Services has announced a new Altamira Monthly Income Fund, available immediately.

“The Altamira Monthly Income Fund is ideal for investors seeking higher monthly payouts than traditional balanced funds, with a targeted yield of 5% and the opportunity for modest capital appreciation.” said Ian Dillon, Altamira’s chief investment strategist.

The 100% RRSP-eligible fund will invest in income trust units; preferred shares; dividend-paying common shares and high-yield corporate bonds.

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Great-West offers advice services to plan members

(May 3, 2004) Great-West Life has teamed up with Acquaint Financial to offer third-party financial educational services for members of its group savings plans, including a financial planning and education Web site, and financial planning seminars.

“Our services, iAcquaint and Financial Education Seminars, help plan members improve their personal financial lives and take charge of their financial future,” says Asaf Shad, president and CEO of Acquaint. “As a fee-based and independent financial educator, we are not tied to any investment products nor do we share in the revenue from the sale of such products.”

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(05/03/04)