Financial Advice For All

Banning commissions will put Canadians at risk of losing access to affordable, quality financial advice. Visit to protect the financial well-being of all Canadians.

over 4 years agoJanuary 11, 2017
Libby Wildman
about 4 years agoFebruary 15, 2017
Greg, thank you. I Have shared on my facebook. It is clear from other countries where this has happened that the results for the citizens and families have been disastrous. The government would have a lot more people on social assistance and collect a lot less taxes at death, if our industry of providing protection while sick and at death, was taken away in its current format where advice is the reason people take action.
Dan Dean
over 4 years agoJanuary 11, 2017
Excellent message Greg!  Thank you.  Not only do we need to make sure all Advocis members hear this and respond by getting involved, but this message especially needs to get to non members.  I expect this will encourage them to join our cause.
David Rounthwaite
over 4 years agoJanuary 11, 2017
The only answer that makes sense is choice. Our government needs to understand this and let the client choose.
W. A. MacGregor, CFP
over 4 years agoJanuary 11, 2017
To me all this is a shell game.  Nothing really changes.  With pay direct, the client still pays the same fee as he or she did in embedded fees.  By the time you add the MER from the fund company to the pay direct fee, there isn't much of a difference.  All this does is cost the client more for the higher costs that are involved by dealerships and fund companies to manage this new fee structure, so ultimately the client pays since these higher costs will show up in higher MER's.  I've been in the investment business for 34 years, and all I have focused on is net returns on the investment.  We set a target and we select the funds that meet this goal.  I only use FEL 0 fees, so the client always has full mobility to move in and out of a fund and the fund company.  I never look at the commission one fund will provide over another, I simply look at what the fund will do for my client.  I know I'm not alone in this approach and for an organization to suggest that we do otherwise is an insult to the advisor and our profession.
over 4 years agoJanuary 11, 2017
Certainly for someone like me, with 34 years in the business, I could not provide the advice I've provided to so many throughout the years without commissions. My market has been in that 80 per cent of the population. Fee for service does not reach the masses
Karen Dorman
over 4 years agoJanuary 11, 2017
1.  This initiative will not allow the clients a greater understanding to what they are paying as the fees are disclosed now.  
2.  We are heavily regulated providing proof of full disclosure, know your client information including the delivery of fund facts with every recommendation.   Maybe  the Fund Companies could agree to pay a stated trailer for each asset class therefore there would be not opportunity to sell the higher commission fund.  
3. This will not stop illegal or immoral activity it will only hurt the clients that need the most help.  LOWER income.  
4.  With companies backing away from Defined Benefits and offering Defined Contributions clients are now advised to seek the advise of their financial planner.   If this ban were to proceed many of the advisors those clients are seeking advice from would be a "computer"
Bruce MacLean, CFP
over 4 years agoJanuary 11, 2017
Exactly Anonymous.  The CSA is not listening and has already set their course.  Main stream (low net worth) Canadians will once again be kicked while they are down, left abandoned and to fend for themselves.  The advice I offer doesn't come at a direct cost, it's actually like a group plan where the benefits are given to all members while the costs for such are provided largely by the higher net worth clients.  The CSA move will enhance GST / HST revenues for governments since advisors will now need to be HST/GST registrants, unless they don't clear the $30k in fees and if they don't they will be handicapped to even remain in the business.  A large advisor exodus will occur and, already, many advisors are switching to segregated products to avoid this disastrous move by the CSA.  Like MacGregor, I tend to use FEL 0 fee investments for clients as I've never been one to limit options for people.  The CSA is ignoring our pleas which certainly spells disaster for so many unfortunate Canadians.  In fact, I've already shown clients how their fee based investment management and advice from the banks are actually costing them more than before.  Go figure.  I certainly won't be able to set up my practice as a registered charity.
over 4 years agoJanuary 11, 2017
Yes, this client will choose, I will withdraw all my investments.
Frustrated Canadian
over 4 years agoJanuary 11, 2017
Whose "best interest" is the CSA REALLY serving?
over 4 years agoJanuary 11, 2017
I am not saying I agree with the CSA...but I  would also be shocked to think that no one saw this coming......first with overly aggressive illustrations beyond 6/8 %  annual returns...the  DOT COM crash of 2000...the market crash of 2008...then the banks slowly taking over the Mutual Fund Industry...hey they don't charge they?

To me. this is nothing more than positioning by the Big 5 banks...they were kept out of buying Insurance they went after the  money business......and make the rules now.
almost 4 years agoMay 12, 2017
I totally agree with you that Canadian Big Banks are behind it. 

Thanks to CBC Go Public program that exposed bank's dark-side to public. Misleading clients, tied selling by Bank staff is widespread in Canada and there is no quality advice. Bank staff use business titles without credentials, professional qualifications and relevant experience. 

Most discount brokerage are owned by Banks and they collect mutual fund trailing commission without any service to clients. Dr. David Dodge perfectly referred Canadian Financial System as a Wild West!
Greg Snider CFP
over 4 years agoJanuary 11, 2017
This is a difficult topic.  With a mature practice I have the options of being selective of who I can provide advice for and the ability to attract higher net worth clients to make the relationship a win/win one.  Over 98% of our business is fully transparent and fee based.  This model is appropriate for where we are today. 

Depending on the wealth planning offering of the various advisory platforms within our industry the value for advice will always be subject to the quality of delivery, consequently it is up to the advisor and client to decide how to best meet their needs. 

If I think back to when my now wealthiest clients first did business with me, collectively we would have not been able to provide complete advice without the benefit of the various choices of compensation packages available.  

Choice is always better and full disclosure and review as currently legislated in CRM-2 meets most of the need.  The value for service discussion is alive and well. 

We will need to continue to be vigilant in promoting sound business practices and ethics.  Thank you to Advocis for continuing this discussion.
Douglas F. Deichert FPSC 1
over 4 years agoJanuary 12, 2017
It is the ones with lower income and the blue collar labor force trying to get through life that are going to suffer the most. As a commissioned adviser I have a vested interest in how my clients investments perform. My clients rely on me to give them sound advice and many do not see all the extras we do for clients that we don't get paid for.

When is the last time you were happy you had to call your lawyer. My Clients know that they can call me any time and I am always happy to provide service and talk to them without the fear of them being billed $100  plus per hour or more.

Then consider a client that wants to put away money into their RRSP so they get a tax break on their income tax. But now they have to pay me a fee over and above that. Well they just wont put as much savings away as what they would have if they did not have to pay me out of pocket. It is the out of pocket expenses that effect our clients and the choices they make.

Fee for service is for the wealthy and not for the general public. 

Only advisers with large books of business dealing with the wealthy only will remain in the business. 

So what would be different if the client pays 1% for the dealers reporting and my service or they let the investment firms pay use to do the work for them. It is not an out of pocket expense and they get to invest all their money.

Competition in the market place makes a difference.

Advisers are being punished for the wrong doing of a few bad financial persons and the wrong doings of many telemarketers. The regulators have not stopped those robo calls they have actually got worse.

Full and honest documented disclosure is the only way to serve all and I fully support CRM -2 and the ability to offer clients options when it comes to compensation. Regulation is actually increasing the cost of doing business at all levels.

Young people need advice too, especially when they don't have money and are just starting out. There would only be one outlet for them to use and that is the bank.

I had a recent conversation with a bank adviser and she stated at the branch we do not get into full financial planning. Try to get an appointment at the bank for 2 hours with your adviser. It will not happen. Good advise takes time. 

I am a proud member of Advocis for 18 years and believe any Financial Advisor should be a member of an organization that supports good business practices and ethics.

Thank you to Advocis because without you I may be no longer in business in the future. I am a small practice working completely on my own because I really cannot afford to hire an assistant and if I did have an assistant I would have to let that person go if compensation alternatives were lost.

Compliance departments are the largest part of the Financial Services industry and it does not come cheap.

There needs to remain an option to having to deal with the banks.
Brad Stenning CLU CFP
about 4 years agoJanuary 13, 2017
As indicated earlier "Choice is always better". Full disclosure is absolutely necessary and good.
To understand a client's needs, to build a trusting relationship and provide proper financial planning takes time. For most Canadians this time is at a point in their life that the resources to pay separately for the advice is not an option. Delay only makes things worse. It is imperative that people have access to advice. Allow them the option to choose the best method for them to receive and pay for it.
Grant Karst CFP CLU CHFC
about 4 years agoJanuary 14, 2017
What is the cost of the CSA and the rest of the regulatory bodies who collectively say they are acting on behalf of investors? Their cost is not transparent so it must be embedded.Who pays for their salaries and benefit packages as they build their empires? Taxpayers and the investment community. What have they ever done to prove their value to investors?
At the very least , the CSA should be held accountable to allow CRM2 to get beyond the 1st month of it's launch before coming out with yet another change to protect investors. Costs are embedded in almost everything we purchase - some are more transparent than others but the bottom line always comes down to ;" Am I receiving value for what I'm paying?" I've been a member of Advocis for over 37 years and it is the lone voice of reason in this discussion.
Allan Johnson
about 4 years agoJanuary 19, 2017
I find it very discouraging that none of these Regulators have contacted me to ask what it cost me to provide the services I am expected to provide. Has my operating costs increased? How about all of the required fees we are forced to pay? E&O Insurance, FIB Insurance, MFDA Fee, Marketing Expenses, Registration Fees, Technology Fees, Website fees, Client Statement costs etc. In my case, over $25,000. I also noticed that there has not been an increase in my Compensation in the past 22 years. In fact, they have been declining. So, cost of business going up and commissions going down. How many Advisors are going to be casualties in all this? How many clients will be left behind as a result of these decisions. It is very sad and disappointing to have these regulators trying to pull the rug on Independent Adviso'sr after spending 20+ years building a client base and a business.
People with small accounts will suffer.
about 4 years agoJanuary 23, 2017
Bottom line.
about 4 years agoJanuary 26, 2017
Less regulation not more. Give people a choice. Clear and transparent industry and let the market decide. End of story.
Voice of the Client
about 4 years agoJanuary 26, 2017
Why are these changes being made?  Asking the regular working class client to pay for advise with after tax out of pocket dollars, is a recipe for disaster.   I can guarantee that finding the money to pay one more invoice when things are tight, will be a problem.  The system currently in place works for me!  Everyone, including the client, wins!
about 4 years agoJanuary 27, 2017
Totally agree with you. What do they expect skill happen to the Canadian people? As advisors we cannot afford to work for nothing and the people cannot afford to do it without advice. Especially knowing the demographic of the baby boomers coming into retirement.
Bob White, CLU Member of Advocis since 1977
about 4 years agoFebruary 1, 2017
Every Financial advisor in Canada, must communicate to their MP, MLA's, and communicate to their clients that this is not good for clients, not goof for Provincial GDP's.  Because, if clients are required to pay fees, it will not be are they getting value, they will not be prepared to pay $250 per hour, for services, because that is what it cost to keep the doors open, or more depending where the advisors office is.

The broad population does not want to pay, example why does every Canadian not have a will?  They are not prepared to put it off until it is too late, because they do not want to part with the hard earned dollars.

But the bottom Line is there is no free lunch, clients understand that we get paid, CRM 2, disclosure allows the clients to decide if there is value for fees.  Looking at the "The Canadian Securities Administrators (CSA) published a consultation paper "

Read through and look at their charts and comments and you can quickly see that their analysis of the  information is very skewed,  

Read the document, and if your blood does not boil on how they have twisted data, have not applied an intelligent thought process,.

It is very clear that the people making these decisions and comments do not live in the real world.  They take a set of data facts that lean to the results they want.  

When I look at the data i conclude different results based on the facts, and most likely because I live in the real world and see what happens in the industry.

The bottom line is if an advisor is not prepared to stand up and be part of the solution and fight against what will effect them and their clients, then leave the business, because you become part of the problem.
about 4 years agoFebruary 3, 2017
Isn't this the road that Uk and Australia went down and completed flopped. Clients/Consumers did not have access to real advices. Many advisor out right quit. For and industry that is already short advisor what a very damaging choice to make !!!
Phil Girard EPC CPCA
about 4 years agoFebruary 16, 2017
I have been in our industry for 35 years and have built a business from scratch working with the Mom and Dad market.  I went to peoples homes and sat at their kitchen tables helping them set up the insurance for their families and helped set up their investments so they could look forward to a comfortable retirement.  They are all part of the 80%.  Just regular people.  I have made a difference in their lives with the service and advice I provided.  All this time with embedded commissions.  What makes the regulators think the system is so broken?  These proposed changes to remove commissions would absolutely have a negative impact on my clients and my business model.  I know they would be reluctant and find it difficult to pay for my advise out of pocket.  So what do I do, work for nothing?  I already take the time to disclose how I get paid and how much their business pays me.  They are given the choice of BEL, LL or FEL and understand the differences their choice makes in how much I get paid.  I have never had a client tell me that I got paid to much or that my advise was not worth paying for.  They understand I have bills to pay every month just like they do.  If these regulation changes are allowed to go forward it will be a disaster for all Canadians and devastating to our industry.  The big banks win.  We all lose.  It's that simple.
 We all need to stand up and fight this.  Get involved.
Dan Moore
about 4 years agoFebruary 16, 2017
The fight is over in my opinion, these changes are going to take place. Investors Group already got rid of DSC in Dec 16 the industry now will follow suit to be competitive. The Bank's lobby will work this time. 

The manufacturers are making ready for the transition right now. Takes a long while to turn the titanic they are making ready.

The bottom line here is how you position your business. I figure if everyone is on an even playing field I should be able to succeed so will you and the client will need you to go through this, as they grapple to understand

One thing here we are missing, the insurance industry will still have to sell product and they will look after the sales force that moves them. They will purchase existing MGA's and go direct. Strong Agents will survive and so will their clients.

The Agents that have bigger blocks will survive in the new system easier in the transition  but will have difficulty selling at retirement. Succession planning is crucial.

The clients will be fine and paying a direct fee taken off their investments and no upfront commissions. It will be easier to see the breakdown for them but the relationship should not suffer once they understand.

New Agents in the industry will have to be financed as they will starve financially on their own. But Insurance companies saving on trips and MGA bonuses will re-allocate resources. Their will be no MGA middleman.

Develop a business plan that effects the changes and transition now a little at a time.

Just my two cents....
Abe Toews
about 4 years agoFebruary 21, 2017
Keep up the great work - we need a strong voice for clients and advisors. 
My question - why is the cost of compliance not broken out on CRM2? This is a direct expense to clients as the companies pass these cost on through MRE's.
about 4 years agoFebruary 24, 2017
Thanks for your comments W. A. MacGregor, CFP! The greedy advisors tarnish the image of the industry.

CSA should introduce progressive policies that are fair, reasonable and in the best interest of investors and to industry. Why would few advisors cry on CSA's proposal if they are transparent to clients and clients are happy? It is in their best interest, all investors want better rates of return on their investments and low fees to benefit them.  

DSC/LSC should have been banned by CSA long ago or redemption DSC charges should be charged back to advisors and not to clients as advisors failed in their suitability reviews. Fund companies also end offering DSC/LSC load type considering the best interest of clients and reduce their MER. CSA must ban DSC matured units to new DSC schedule investing, moving from mutual funds to Seg funds and vice versa to generate new additional commission to advisors.

Too many transactions in client statements and confirmations received by clients as DSC free and matured units are switch into FE and active trading by advisors although mutual funds are a long term investment.  CSA must demand for mandatory client statement with each fund and consolidated performance reporting of 1, 3, 5, 10 Years and since inception. Total annual and cumulative MER in percent and in dollar should be reported on the statements to help clients to compare their investments at the banks and through dealers. 

Brokerages currently charge 1.50% annual Fee for service of the total investments whether funds in money market, fixed income that is quite high compared to the trailing commission paid by fund companies. Advisors can tell their clients what is available in the market and convince them that they charge less for their personalized services, client meeting at their homes, work places, able to contact/discuss after hours and so on. Clients must understand what is best for them and choose the best model. Small investors are affected by Fee for Service model as most advisor wants to serve them. Like in US, UK, EU, Australia, investors must be able to invest directly with fund companies and companies should provide platform services at cheaper rates as many new generation investors may not need advisors.

No one can blame CSA as fund manufacturers, few advisors, few brokers failed to be fair to investors. If a charge, fee for service, advisor compensation is fair, of course everyone will accept it. CSA should focus on putting an end to tied selling by banks and bank staff's misleading communication to clients.
about 4 years agoFebruary 26, 2017
I contacted my MLA and they told me to send a comment letter and attend in person consultations being held by the ASC in 2017. When I go to the ASC website no mention on when these will take place!
about 4 years agoFebruary 26, 2017
Once again the Canadian constitution for citizens is being taken away! That being the right to choose!my other question is why if they aksing me to pay up front why does this not affect the health industry? I don't know how much my Dr charges for his services?
about 4 years agoFebruary 26, 2017
It is interesting that we do not know Doctor charging Canadian Health Care system for each appointment/treatment  but he can charge only for consultation and per appointment and no regular trailing commission or service fees are paid to them.

Investment management is a long-term business relationship between an Advisor and investor and it's continuation depends on Advisor meeting investor's goals, targets and overall satisfaction. Why would an investor pays commission if their  Advisor did not perform or meet investor's goal/expectation or investor is unhappy with investment performance or does not want to deal with the advisor for any other reason.

Initial sales charge commission, front end or back end and switch fees should be banned as investment management is a long term business relationship and quite high rate regular trailing commission is paid to advisors. The industry has to be fair to investors as investors are suffering due to high MER.

I agree with comments about investors' choice and rights, they should be able to choose their advisor but those investors should be able to pay fee (fee for service)for their choice and no embedded (DSC/LSC) commission or FE commission can be charged. Initial sales commission (DSC, LSC, FE) is certainly not in the best interest of investors as it affects largely if advisor and investor relationship ends for any reason in a short period of time.  

If Canadians can invest directly with fund companies in the US, many investors will invest in the US.
about 4 years agoFebruary 27, 2017
Canadian discount brokerages too are greedy as most of them are owned by Canadian banks. Discount brokerages should offer F Series mutual funds like EFTs and closed ended funds for fee per transaction.

Better educated investors with sophisticated investment knowledge cannot invest directly with fund companies in Canada. Greedy discount brokerages with their outdated systems and not providing any investment advice, collecting trailing commission from fund companies. 

Its time to streamline and regulate the industry that benefits ordinary investors,  competitive and transparent. Advisors can offer their services stating/publishing their fees and also provide a comparison to the fees that investors pay to "fee for service" brokerages to attract prospective investors.
about 4 years agoMarch 10, 2017
Maybe someone should tell the Government that if they eliminate trailer fees that once investors go to direct pay the fees now become a tax deduction on non-registered accounts. Big los of tax dollars for the government I wonder what they would think about that!
about 4 years agoApril 6, 2017
Canadian Securities Industry requires positive changes in order to be fair to investors, in the best interest them and compatible to other nations, like Australia, UK, US, EU.

In Australia, investments can be bought through platform providers for a fraction of fees that Canadian investors pay in Canada. Australia Superannuation scheme provides sound retirement benefits to working class than CPP benefits provided by Canadian government. Superannuation scheme would have helped the investment industry to grow further in Canada. In the UK, British government has increased Tax Free Saving contribution room to 20,000- British Pounds from 15,240 British Pounds in 2017 as an inducement for its residents to save for their retirement, home purchase or kids’ education and sends a strong message to its citizens not to depend heavily on government benefits during their retirement.  No history of a nation that prospered well when it believes in higher taxes/ fees / charges from its citizens and state controls important services like communist nations without any fair competition.  

After CRM II, Canadian fund companies start reducing funds’ MERs and eliminating DSC load type. Canadian investors have been at the receiving end. Advisor should prove their value to investors by outperforming goals and justify advisor compensation. 

Few financial institutions have been allegedly deceiving clients with their sales tactics and they employ unsophisticated systems that are not capable of providing customized annual compound rates of return on statements, performance comparison with index/benchmark and costs that investors pay as well as lacks in account and tax reporting to CRA or issue required tax forms including T5008.

Thanks to CBC Go Public program’s recent investigation on Banks’ selling tactics and welcome sign as many bank staff came out and provided information to CBC Go Public program on their experiences to bring public awareness.  

Disclosure, Transparency, Fairness, Value, Trust, Confidence are important in any business to prosper.
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