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Email this8:38 am
April 6, 2013
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i_got_smucked_too said
The IIROC bus is only an "administrative action". It is "not" a civil or criminal proceeding.
The screwed over stakeholders of PACE Securities / PACE Financial / First Hamilton Holdings (of which I'm just one) won't be seeing a dime from the "administrative action".
The second IIROC brochure at IIROC: Getting Your Money Back confirms that:
As an investor you can complain to IIROC and we will review your complaint to determine whether or not your advisor and/or firm has broken our rules. If we find that our rules have been broken, we may take disciplinary action including fines, suspensions or permanent bans. However, IIROC cannot provide compensation to you or force an investment firm or individual advisor to reimburse you.
9:56 am
October 27, 2013
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Norman1 said
Sheri said
Norman 1, you sure know a lot about the particulars of PCU and Pace Securities and the investments. Why are you so keen to prove those who were grievously affected by this situation wrong? How are you so matter-a-fact about things?What exactly were you expecting? Were you expecting to find the truth about your situation or were you expecting a fairy tale about how everything will be okay?
Norman1 is making a considerable effort to provide some factual information here so that it provides a reference point, for those who have been damaged, to consider as part of their decision making and forward actions. Would y'all prefer that he just walk from this thread? Don't shoot the messenger. Be gracious for useful information you are receiving.
I suspect all of us reading or participating in this thread have boatloads of empathy for those who were scammed or feel like they were scammed in a life altering event. We do hope you will get some restitution out of the whole mess.
11:38 am
May 15, 2020
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I think one of the reasons this thread is here is to gain input of all kinds, looking for any answers even from those who wish to provide same appearing to fan flames or not - its all good. This site has high volume and people here who are not keyboard warriors. Google data mining occurs here as well and the more discussion occurring within this thread on this fiasco the better - which is what keeps it showing up on Page 1 when you Google Pace Credit Union, and keeps them paying for a company to hit their other URL's 1000 times per hour with inquiries to push it back off the page because most people don't look at Page 2.
They're going to be paying that company for many many years to come to keep doing that, but Google won't be the only thing dogging the shine on the logo that is for sure. Floodgates are only dripping at the moment, it can get enormously worse and exponentially build through other avenues unless the results of the internal inquiry point at a clear path to dodge the artillery shell incoming. Just my humble opinion... flame away 
12:10 pm
May 19, 2020
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I actually enjoy looking at what people who have been doing this for years have to say about the issue.And Norman has been on here giving the legalities of the situation.We are all allowed to have a viewpoint.Maybe Norman does not get that this was a scam.When I finally got a copy of what I signed it said I had 2 days to cancel.But I was never given that option because I was never given the contract.That was not my fault.The person at the CREDIT UNION was the one who was supposed to know the rules.I was just there to renew a GIC that had expired.Since no one seems to know what the GIC rates were at Pace Credit Union on Jan 15 ,2018 -not even Pace(which is beyond bizarre to me)I can only think I said I could get a better rate elsewhere and that is when the scam came.If I had not been in a Credit Union I would have walked-but I was in a safe place.So I thought.This scam was pulled on multiple people in multiple ways-but all you guys who say we were just out for a buck-give it a break.Provide some useful info.Don't make me feel like s--t .I already do.My bloood pressure is already rising.
Maybe you old timers know when this scam was done before.I would like that info.And how it played out.Do other Credit Unions have Securities?
1:24 pm
July 2, 2020
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Elaine said
..... Since no one seems to know what the GIC rates were at Pace Credit Union on Jan 15 ,2018 -not even Pace(which is beyond bizarre to me)I can only think I said I could get a better rate elsewhere and that is when the scam came. .....
I don't have an exact answer for you either, but maybe I can give you a ballpark based on my experience:
- Feb 2017 - $100,000+ GIC - 14 month term expiring April 2018 - 1.95%
- June 2017 - $100,000+ GIC - 12 month term expiring June 2018 - 2.0%
- June 2018 - $100,000+ GIC - 12 month term expiring June 2019 - 2.5%
I know it doesn't ease your pain. It certainly doesn't ease my pain, but there you go.
1:39 pm
October 27, 2013
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Norman1 is simply stating the legalities...as he should to the benefit of all that 'got taken' in one form or another. That *IS* useful information as everyone needs to know what the push back will be from the lawyers and Pace itself. What else should he do?
I am pretty sure he does not lack empathy but empathy, for the sake of empathy, will not help any of you resolve the issue. Many recommendations have already been made from hiring lawyers to getting paperwork (evidence) in order to getting media to profile this case to participating in hearings, etc. It is all helpful, is it not?
Every "scam" is different but they all have one common characteristic. They offer returns that are too good to be true and/or use smoke and mirrors to misrepresent the product and its risk profile. Spending some time on any of the Securities Commission websites, e.g. Ontario Securities Commission, Alberta Securities Commission, will turn up all sorts of disciplinary actions. There are probably dozens of active cases at this very minute where investors have been fleeced.
This Pace one is especially egregious in that the CU vehicle was apparently used to capture unsuspecting investors who are normally trusting of their CU and had little reason to raise red flags. James Hymas in PrefBlog of June 18th http://prefblog.com/?cat=16&paged=2 said it rather well.
6:29 pm
March 30, 2017
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i_got_smucked_too said
Elaine said
..... Since no one seems to know what the GIC rates were at Pace Credit Union on Jan 15 ,2018 -not even Pace(which is beyond bizarre to me)I can only think I said I could get a better rate elsewhere and that is when the scam came. .....I don't have an exact answer for you either, but maybe I can give you a ballpark based on my experience:
- Feb 2017 - $100,000+ GIC - 14 month term expiring April 2018 - 1.95%
- June 2017 - $100,000+ GIC - 12 month term expiring June 2018 - 2.0%
- June 2018 - $100,000+ GIC - 12 month term expiring June 2019 - 2.5%
I know it doesn't ease your pain. It certainly doesn't ease my pain, but there you go.
To add to this, I am fairly comfortable to say with 100% certainty that 5y GIC rate has not been anywhere close to 5-7% for the past 10 years since the financial crisis of 2009.
https://www.tangerine.ca/en/rates/historical-rates
This link showed you where savings rates have been since 2009 and the 5y GIC rates is ~200 bps above that at any point in time.
8:13 pm
June 22, 2020
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Quoted from the comments to the Globe article
“The credit union will also “explore creating a recovery fund” to provide interim relief to members facing hardship from financial losses.
If the allegations are true in respect to how the product was sold to the retired worker in the article, they need to reimburse that client in full, immediately and make her whole. Nothing interim about it.”
They need to make everyone whole.
7:25 am
May 19, 2020
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savemoresaveoften said
To add to this, I am fairly comfortable to say with 100% certainty that 5y GIC rate has not been anywhere close to 5-7% for the past 10 years since the financial crisis of 2009.
https://www.tangerine.ca/en/rates/historical-rates
This link showed you where savings rates have been since 2009 and the 5y GIC rates is ~200 bps above that at any point in time.
Which makes the rate of 3.51% being offered at Pace for their 3 year GIC a bit strange with the rates so low everywhere else.Are they needing money?
Or trying to attract new customers.But never saw advertising for it.
This was just a few months ago -so I was shocked to get a rate like that.Of course that was before all this stuff happened.So this is why I have this weird query in my brain that won't shut up(brain worm) was Pace Credit Union keeping other investment rates artifically low so that people would get streamed into the Securities Scam?What other investments did Pace Credit Union have then?Only 2 and a half years ago-some of the long time members ought to remember.I just like to figure stuff out and this GIC interest part does not makes sense to me.
Web has been swept clean-nothing to see behind any of the pics on google or Pace Facebook site.It's like they think it's got Covid and everything has been washed with soap and water.Nothing left to see.
This is one reason I have little faith in "what happens next" from Pace.
8:13 am
July 2, 2020
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I think it's time to name names.
I'd also like to assemble some statistics.
I'm willing to facilitate this, but I need data. If you wish to participate, please PM me with:
- if known, the name of the low-life that advised you (also known as, your PACE Securities investment advisor)
- the company you were sold, PACE Financial or First Hamilton Holdings
- the amount you had invested
I do not want any personally identifiable information, so don't send it.
Once I receive sufficient PMs, I'll post a summary (and follow on updates) of the results obtained so far, showing something like:
- the name of the advisor (I'll use "John or Jane Doe" if any advisor gets 5 or less respondents
- the number of clients responding
- total amount invested through that advisor
I have no idea if this exercise will have any value, but I'd like to see what can be learned from the data. Any yes, the participation rate needs to be quite high, but one has to start somewhere. So PM me!
10:46 am
September 11, 2013
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i_got........., if you're going to name names, are you going to provide your real name as well?
11:23 am
April 6, 2013
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Elaine said
I actually enjoy looking at what people who have been doing this for years have to say about the issue.And Norman has been on here giving the legalities of the situation.We are all allowed to have a viewpoint.Maybe Norman does not get that this was a scam.When I finally got a copy of what I signed it said I had 2 days to cancel.But I was never given that option because I was never given the contract.That was not my fault.The person at the CREDIT UNION was the one who was supposed to know the rules…
I think it is you who does not understand that if it wasn't illegal, then you have no legal recourse.
There are plenty of examples of so-called "scams" that are perfectly legal. Save2Retire@55 reported the money he lost in one of those group RESP plans. kuyachris84 reported his wife's losses with a universal life based product.
No legal recourse in any of them. That also applies to high-fee seg funds.
Just because it is a "bad deal" or one loses money doesn't mean it was illegal.
Now that you have the purchase agreement you signed, does it say you agreed to purchase a PACE Credit Union GIC or PACE Financial preference shares?
If the agreement was for a GIC, then you do have legal recourse. You handed over your money. But, you did not receive the PACE Credit Union GIC in return.
If the agreement was for PACE Financial preference shares, then you do not have a legal recourse. In its ruling for the Churchill Falls dispute, the Supreme Court of Canada wrote that when parties of an agreement receive at least what was agreed to, there is no legal grounds to revisit the agreement. As far I can tell, PACE Financial received your money and you received the PACE Financial shares agreed to. No?
It's not like someone at PACE Credit Union took off with your money. The losses in the value of your PACE Financial shares have nothing to do with PACE Credit Union. Those losses are the result of market value declines in the junk bonds that PACE Financial bought with your money.
That two-day cancellation right is moot. You wouldn't have exercised that right anyways. Why would someone cancel what she thought was a GIC with a 5% rate which was way above what any other GIC issuer was offering?
If you insist that you would have cancelled, then you knew that it wasn't a GIC that you bought and willingly took on the risks!
As AltaRed wrote, you have my sympathy. But, my sympathy doesn't matter one bit towards recovering the losses. The civil courts also work the same way. The judge will be sympathetic. But, if you don't have a legal right to what you are claiming, then the claim will simply be dismissed with sympathy. The Supreme Court ruling in Auton v British Columbia is an example.
The Court was sympathetic but broke the bad news to the mother: There is no overriding legal right to necessary medical treatment in Canada. Such a right is not implied by the Constitution. So, the BC government does have the legal right to decide which autism treatments its public health plan would pay for and can legally decline the experimental treatment she wanted for her autistic child.
Her claims were dismissed in a unanimous ruling.
12:00 pm
July 2, 2020
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Bill said
i_got........., if you're going to name names, are you going to provide your real name as well?
On a public forum, everyone posting uses a "pseudonym" name (including me) don't they ? That should continue, shouldn't it ?
What I meant by name names, I think it's time & reasonable to identify the investment advisor (IA) that screwed each of us over. Thomson & McRae's names are out there. Why not the IAs too ?
If that doesn't sit well with others.... ok I can accept that. I have no axe to grind with anyone that was fleeced out of their investment.
But without the data, it's all moot anyway.
12:07 pm
June 2, 2020
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Bill said
i_got_smucked_too, if you're going to name names, are you going to provide your real name as well?
Agreed Bill. i_got_smucked_too We need to be careful of posting things about other people online publicly. There are laws surrounding that. The only reason people are citing Thomson and McRae, is they are referring to the Statement of Allegations against them.
12:39 pm
June 22, 2020
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Although IIROC can’t order compensation, the “findings” of the hearing and potential disciplinary actions will help establish a legal precedent and help determine responsibility.
The other issue that PCU should be looking into is who from the old regime even allowed these investments to be sold in the first place.
The other issue involves Laurentian Bank Securities (LBS) and why they decided to change their margin requirements. According to the Globe article, PSC was allowed to go up to 4x leverage but never reached this level. So despite the market conditions, we need to know more the exact agreement that existed between these parties. Perhaps PCU will have a legal issue with LBS, but until we have more information, we can only speculate.
Many investors also already owned PCU preferred shares and this is why PSC approached them and indicated that these shares were similar and low to medium risk without providing full disclosure to trusting PCU members.
As for returns, the PCU preferred shares pay a 3% dividend but those who purchased them during the offering received bonus shares if they held them for a 5 year period and received 5.71% return so one can see how it was easy for PSC to dupe members into investing.
As for case law, there are many cases where much more sophisticated investors were reimbursed from their investment dealer for deceiving them into buying unsuitable investments and these cases involved single investors, not a large group (900+) in this case.
Many employees also bought these shares and various reports even listed them as low to medium risk according to the Globe article, so there has clearly been deception on behalf of PSC and it’s owner PCU.
There is going to be significantly more media coverage about this especially as the IIROC hearing takes place.
If PCU is smart, they will make everyone who before this gets any bigger.
3:27 pm
March 30, 2017
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Re margin requirement changes, any exchanges or firm can change their margin requirement and give the borrower 1 day notice. This is perfectly legally and most likely embedded in the agreement too. As long as the firm is changing it with valid reason (eg increased volatility) and not just to purposely squeeze/hurt the borrower, there is no recourse nor anything illegal.
On the flip side, if there was never any covid crisis and everyone just keep receiving their higher than normal return, most including media won’t even know the existence of such a pref.
5:21 pm
June 22, 2020
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savemoresaveoften said
Re margin requirement changes, any exchanges or firm can change their margin requirement and give the borrower 1 day notice. This is perfectly legally and most likely embedded in the agreement too. As long as the firm is changing it with valid reason (eg increased volatility) and not just to purposely squeeze/hurt the borrower, there is no recourse nor anything illegal.On the flip side, if there was never any covid crisis and everyone just keep receiving their higher than normal return, most including media won’t even know the existence of such a pref.
You would think that a professional fund manager (PSC/FHH) would have had some form of risk management plan in place (in addition to taking their management fees) by having some form of capital reserves or “puts” and not just going pure long as it appears. Clearly something was overlooked here as well.
5:52 pm
May 28, 2020
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I was told by PCU that this situation was going on since mid last year before the pandemic. Because PSC could not come up with the funding.
I read all these posts and I feel empathy for us all. It sickens me at times.
I believe PCU will make this right.
I was told in December that my advisor didn't know this would happen but it's just a number thing. I was also told other things that after 5 years I get my money back. I didn't get my signed copy either as what I thought I was signing was going to be mailed to me or something. I transferred more money in early 2019 and then all of a sudden they moved more money to the FHH shares. I sent a email to question this and no answer no reply.
But if anyone wants more information PM
8:37 pm
April 6, 2013
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Investor1 said
…
As for case law, there are many cases where much more sophisticated investors were reimbursed from their investment dealer for deceiving them into buying unsuitable investments and these cases involved single investors, not a large group (900+) in this case.
…
That doesn't matter.
PACE Credit Union is not an investment dealer. As such, PACE Credit Union does not have any of the suitability obligations that a registered investment dealer may have.
That is disclosed by a form similar to this draft Form 45-106F4 – Risk Acknowledgement Form that normally accompanies the purchase documentation when the shares are purchased through someone who is not registered:
The person selling me these securities is not registered with a securities regulatory authority or regulator and has no duty to tell me whether this investment is suitable for me.
Please write your comments in the forum.