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(June 13, 2007) A recent survey for BMO Financial Group finds there is mass confusion over what the role of an executor actually entails.

According to the BMO / Ipsos Reid survey, when given a choice of nine options, only 5% of Canadian boomers correctly identified the tasks an executor is responsible for. The survey found that the majority of respondents understand the basic financial obligations, such as reviewing bank and investment statements, but have little understanding of anything else to do with the role.

Eighty-eight per cent correctly chose the administrative tasks of “pay the bills, redirect all mail, cancel subscriptions,” and the same percentage also selected “review all bank and investments statements and close accounts.”

When it came to understanding the time commitment of being an executor, very few had any idea. BMO says it usually takes more than a year to properly execute a will, but only 17% of respondents anticipated that. Most assumed it would take less than a year.

“This level of confusion over what it means to be an executor is quite surprising,” says Jean Blacklock, vice-president and managing director of Wealth Services for BMO Financial Group. “Based on our ongoing research, we know that boomers have competing priorities and concerns, so it’s important for them to understand that an estate isn’t wrapped up in a couple of months — that being an executor is not a quick or easy job.

Blacklock speculates that part of the lack of awareness of an executor’s role may stem from negative associations with it. Of those respondents who have acted as an executor, or who know someone who has, the top three words chosen to describe the experience were “time-consuming,” 39%; “stressful,” 30%; and “difficult,” 26%.

Seeking professional help with estate planning may alleviate some of these fears, Blacklock says.

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Nova Scotia advisor fined $20,000 for unauthorized trades

(June 13, 2007) The Investment Dealers Association of Canada has fined a former CIBC Wood Gundy advisor in Kentville, Nova Scotia, $20,000 for executing trades in RRSP accounts without explicit instructions from clients.

The IDA says that Stacey Trevor Symonds admitted that, between March and November 2004, he conducted discretionary trades in three client accounts without the accounts being specifically approved and accepted as discretionary accounts.

In all three cases, the IDA found that Symonds had been given signed forms to transact securities within RRSP accounts but had not been given specific amounts. Symonds didn’t bother to clarify his clients’ instructions and instead traded at his discretion.

In addition to the $20,000 fine, Symonds must pay $3,000 in costs and will be under strict supervision for a 12-month period upon any subsequent registration with an IDA firm.

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Manulife launches pair of PPNs

(June 13, 2007) Manulife has launched two new classes of principal protected notes. The Bank of Montreal Manulife Investments Principal Protected Deposit Notes, Global ReturnPlus Class and Canadian ReturnPlus Class will generate potential returns based on the performance of two mutual funds.

The Global ReturnPlus Class will link its performance to the Elliott & Page Monthly High Income Fund and the Mawer World Investment Fund. The Canadian ReturnPlus Class will link its performance to the Elliott & Page Monthly High Income Fund.

Manulife says both classes of notes provide 100% principal protection at maturity by the Bank of Montreal. The deposit notes will employ an asset allocation strategy, providing notional exposure to the underlying funds when their performance is positive and reduced exposure when performance is negative.

All distributions paid by the funds will be reinvested at a rate equal to 100% of the distribution rate of the linked funds creating the opportunity for potentially enhanced returns and tax-deferred growth.

“The deposit notes provide investors with the opportunity to lock in previous market gains while maintaining market exposure through investments linked to two mutual funds with strong track records of performance,” says Bob Tillmann, vice-president of marketing and business development for Manulife Investments. “The principal protection feature makes them an attractive alternative for investors who require stability yet would benefit from potentially higher long-term returns.”

Series 1 of the Canadian ReturnPlus Class is available for purchase until July 6, 2007, and Series 2 is available for purchase until September 7, 2007.

Global ReturnPlus Class Series 1 is available for purchase until July 6, 2007, and Series 2 is available for purchase until September 7, 2007.

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Mackenzie proposes fund changes

(June 13, 2007) Mackenzie Investments intends to call special meetings to discuss changes to the Mackenzie Universal World Growth RRSP Fund, Mackenzie Universal Global Future Class and Mackenzie Universal Growth Trends Class. The meetings are scheduled for August 15, 2007.

Mackenzie wants the Universal World Growth RRSP Fund name and mandate changed. Under its proposal, the fund, which currently uses derivatives to invest in global equities, will become a global dividend fund with Series A units offering a fixed monthly distribution at an annual rate of 5% of the fund’s net asset value per unit, which will be reset annually.

The fund will also offer Series T units, which are suitable as tax-efficient alternatives.

If this change is approved, Mackenzie intends to appoint the Vancouver-based Cundill investment team as the new portfolio manager, and rename the fund the Mackenzie Cundill Global Dividend Fund.

Mackenzie also proposes to merge the Universal Growth Trends Class into the Universal Global Future Class. If the merger is approved, Mackenzie’s Mark Grammer will continue on as lead manager of the merged Mackenzie Universal Global Future Class.

Mackenzie stresses that all the changes are conditional upon investor approval and any other applicable approvals.

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Excel files prospectus for India Trust

(June 13, 2007) Excel Funds Management has filed a preliminary prospectus with all the provincial and territorial regulators for the initial public offering of units of Excel India Trust.

Excel says the India Trust has been designed to provide investors with exposure to an actively managed portfolio consisting primarily of equity securities of Indian companies.

This exposure will be achieved through a structure designed to minimize Indian withholding taxes on capital gains and avoid certain investment restrictions that would otherwise apply to foreign investors investing in India.

The trust’s portfolio will be managed by Birla Sun Life Asset Management Company, a Mumbai-based investment manager.

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(06/13/07)