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(November 27, 2008) CIBC has admitted that the bank is unsure whether it lost track of the personal information for over 470,000 investors, according to a report from the Office of the Privacy Commissioner.

As part of a systems upgrade in December 2006, CIBC had intended to copy the data onto two removable hard drives, which were to be sent from Montreal to its Toronto-area computing centre via two separate couriers. One of the packages arrived without incident. The other package was empty when it arrived, although there were no signs of tampering.

The bank now says that it may never know whether the data had been copied to a second drive at all.

“I am troubled that CIBC has been unable to establish whether a data transfer to a portable disk drive had even been made,” says assistant commissioner Elizabeth Denham.

The data in question included the client names, addresses, signatures, dates of birth, bank account numbers, beneficiary details, and social insurance numbers of investors in CIBC’s Talvest Mutual Funds.

“If CIBC had followed its policies and processes or had a technical means to determine whether the transfer to a second disk drive had actually taken place, quite possibly, no further action would have been necessary,” says Denham. “Whether or not the personal information of more than 470,000 people was transferred to a disk drive should not be a mystery.”

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Mackenzie closing 2025 target-date fund

(November 27, 2008) So you think you can make money over a 16-year time horizon? Mackenzie doesn’t — at least, not on its Destination+ 2025 Fund. The target-date fund is accepting no new money, effective December 31, 2008.

“Mackenzie Destination+ Funds are designed to weather difficult market conditions, and when markets deteriorate, the funds move toward more conservative allocations,” the company said in a press release.

Apparently when markets fall to earth with a thud, the fund slams shut and allocates all of its remaining assets to provincial and corporate bonds and cash equivalents.

Mackenzie is not alone in declaring so-called protection events. BMO Financial placed its BMO LifeStage Plus 2015 Fund in protected status in October, and other sponsors have followed suit in an attempt to lock in the required capital for guaranteed payments at maturity.

For more, read The downside of guarantees hits target-date funds.

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Commodities hit hard in October

(November 27, 2008) The rush to the exits that took place on financial markets in October took a heavy toll on commodity prices, according to the Scotiabank Commodity Price Index.

The index of Canada’s 32 major export commodities fell 15.6% month-over-month, making it the worst month since the index was created. Scotia says the biggest driver of the decline was the stampede of hedge fund managers from the futures positions and commodity index-linked investments.

“Recognition that much of the G7 economy is now contracting has also pushed down prices,” says Patricia Mohr, vice-president, economics and commodity market specialist at Scotiabank. “Global economic prospects have been marked down further, despite a massive fiscal stimulus package just announced by China. World growth is now expected to advance by less than 2% in 2009, compared with GDP gains of 5% in 2006 and 2007.”

The oil and gas index fell the furthest, losing 21.8%. Crude oil fell from north of $100 per barrel to about $50, which the bank says may indicate overselling.

One bright spot on the overall index was potash, which edged higher from $862.50 per tonne (freight on board, Vancouver) in September to $869 in October. Canadian producers won a major contract from Malaysia for $1,000 per tonne, delivered.

(11/27/08)