Pace Securities | Page 10 | General financial discussion | Discussion forum

Norman1 said

Yaftica said
Some Interesting Info I wish I knew about a long time ago::

https://www.theglobeandmail.com/investing/article-preferred-shares-are-priced-attractively-but-proceed-with-caution/

https://www.raymondjames.ca/branches/premium/pdfs/preferredsharesreport.pdf
…

The preferred shares info there doesn't really apply to the PACE Financial preferred shares.

Those preferred shares are ones issued by large established companies, like BCE and Royal Bank, that report financial results every quarter. Those preferred shares also trade publicly on the stock exchanges.

In contrast, the PACE Financial preferred shares are private shares that don't trade anywhere. As a private company, PACE Financial is not required to report its financial results publicly. It is not know publicly how big PACE Financial was.  

Thx for clarifying - I suspected as such which is why I said I wish I knew then what I know now, the differences in the product and obviously the substantial differences in risk potential. Would have been nice to have been told that by my advisor, something to this affect maybe " I need you to sign off on the fact that your $ is going into an area which is considered an 'Investment Grade Cut-Off' for an investor regardless of your potential to absorb loss or whatever you're being characterized by me, but that your money will remain 'Speculative - at substantial credit risk, and benefits are speculative in nature. The protection of dividend and principal is uncertain, but especially so during times of economic adversity' So you could lose everything basically - clear ???

These "advisors" were so heavily commissioned to sell the preferred shares (I understand as much as 10%), they had little interest in selling things like directly-owned bonds for example, because there wasn’t enough money in it for them compared to preferred shares. Appears to have created a scenario where the advisors would direct clients toward preferred shares, even if it wasn’t in the clients best interest (by exposing them to extremely high risk) because there was a juicy commission in it, yes? Certainly in my experience, the advisor was promoted as such by the credit union, but in fact he seems to have been a salesmen running a confidence scam.

These huge commissions were also likely motivating Pace Credit Union employees to direct customers into the preferred shares as well. In fact I know they got commissions clients had to sign off on it. Either ignoring or not knowing what they were really selling, just motivated by the idea that they could pocket 10k in commissions on a 100k investment. Everybody walks away happy.

I’m also understanding that Pace Credit Union set up Pace Securities with the express intent to sell these kind of off-market high leverage investments to their (mostly) unsophisticated investors, first timers like myself. They weren’t a broker in the conventional sense, they weren’t even set up like one. They were a sales office set up to do exactly what they did.

You think this wasn't blatantly clear to the Executive Team at Pace Credit Union from the get go? Well, we know where two of them are these days. Pace Credit Union created Pace Securities or Financial Ltd, a company that from my understanding could only sell traditional securities by working with Laurentian Bank via a middle man position. I think it is quite obvious now that investments like these preferred shares with high leverage (but with the appearance of having the security of a bond) were an essential part of their business plan from the start. Now that the rug is being turned over that will no doubt be a major crux with the subsequent investigation.

It seems clearly a business plan of mal intent, secretive in nature and the kicker may lie with which advisors were privy to, all of them? Were they all perpetuating this specific business like that? They had individuals ensnaring clients from the Matheson Head Office Branch. When this eventually unravels in Court these people will likely have to come clean with statements if records are not revealed to litigation counsel on what exactly they were told to do, how much or how many of these preferred shares were they given, alloted, had access to, where did they obtain the product counselling, the training, who provided it, this is all Internal. (If they ever want to work in Financial Services again that is and know what is best for them career wise now, time to sing will be soon)

PCU should well understand by now that this is about to blow wide open with a major exposure on the liability side, especially if they chose to continue with a rhetoric that PF Ltd was a separate organization under our noses with separate management structure and under the Business Corp Act they acted independently in all aspects of transactions and business services which clients were clearly warned of in the microscopic print of agreements they signed (or we think so that is)... Never mind where the business took place, under what blatantly obvious Brand Name and how the client was specifically referred to them, we didn't really know what they were doing so yeah... don't imply we have liability here.

Sure, good luck with that... I think they know full well what's coming down the pipe now. Starts with S. In spite of a desire to scream from the rooftops I remain optimistic however that there is still time for them to head this off at the pass. The internal 'inquiry' should allow people to come to their senses and when the options are put on the table to the financial institution that it is very clear what direction needs to be taken here to protect the integrity of the brand and the client loyalty base still largely unaware of the impacts fellow members are dealing with, never mind the media etc.

There is window alright and its closing, people are experiencing devastation at this loss, anger, the personal injury liabilities are increasing every day, many are likely not willing to hold the line much longer before a highly publicized class action is launched would be my primary worry if I was sitting at the table with PCU trying to determine a way to put a cap on this fairly and equitably for the banks interests. Civil process be what it may, these days can also affect a corporations valuation huge. The spin off affect to the revelations that people who entrust such a corporation to their life savings because of what the brand promotes and the loyalties they have are being tossed aside for reasons like 'we don't operate within a business model or structure that can actually help you in this situation', meaning... perhaps people need to consider a bank ? I'd be shaking my head as a VP over there and not choosing to go down that road and change my brochures now.

They need the opportunity and time afforded right now to give this an in depth look, its a fair expectation that there is a process and it has to be played out, with E&Y, Laurentian etc. But, ok I've already said enough.

Thanks for reading my angry rant. I'm not stupid - I know full well who else is. Hopefully it helps them understand where the client base frame of mind likely is at this current juncture, and what message needs to be resonated as soon as practicable.

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Doesn't smell of Criminality at all, not one bit. Yes this is certainly taking the CU into new territory with the rest of the membership alright. Damage control is in full swing here but again, not losing complete faith in them yet these are steps to support us, much much more at stake than these deposits.

No I would call that a perfectly scripted response from the public relations team to show concern, compassion, some acknowledgment and information showing that the Corporation is being responsible in tackling the latest fiasco brought to their attention.

Similar to a meat packing plant who is sanitizing the place now because of the recall of burgers laced with something traced to their plant, the public response is just as important as the sanitization process if they ever wish to restore or protect public confidence in the hot dogs as well.

This can and will have far reaching consequences so it’s important to sanitize every part of this puzzle from end to end including the resolution in order to carry on without detriment to the name on the packaging, cause there’s many different brands of hot dogs these days.

Public may not recall that people got sick but when it’s at a severity point that the food caused something debilitating or worse ( oh yeah, we’re only talking about people’s Life Savings here I forgot ) that isn’t erased from your brand identity quite as easy.