Log In
Register
Home
Topic RSS
Facebook
Twitter
Email this12:46 pm
May 19, 2020
Offline
If anyone is interested.it is an OPT OUT so unless you opt out you are IN.
5:55 pm
August 1, 2020
Offline
My first post here. Just learning how to post properly. I am a PCU member and PCS client.
Thank you all for valuable discussion and information. Can someone please explain to me the meaning of this document. Thank you
6:58 pm
April 6, 2013
Offline
Ernst & Young's Second Report of the Liquidator (July 31, 2020) has background about the appointment of Paliare Roland Rosenberg Rothstein LLP for the investor claimants. The info starts on page 8.
A brief history of the situation is at pages 4 to 7, including the following:
27. In November 2019, the preference shares of both PFL and FHH were re-valued as follows as at August 31, 2019:
- PFL shares were reduced from their original cost base of $5/share to $4.22/share;
- FHH Series A shares were reduced from their original cost base of $9.50/share (excluding the $0.50 allocated to the cost of the accompanying warrants) to $8.17/share; and
- FHH Series B shares were reduced from their original cost base of $10/share to $7.49/share.
28. In April 2020, due to the impact of the COVID-19 pandemic on the global economy, PSC re-valued the market price of the preference shares of both PFL and FHH again. PFL preference shares were valued at $1.62/share for a total value of approximately $5.0 million for all outstanding shares. Both series of FHH preference shares were valued at $1.44/share for a total value of $4.5 million for all outstanding shares. These valuations represented approximately a 68% decrease of total initial investment value for PFL preference shareholders and an 86% decrease of total initial investment value for FHH preference shareholders.
29. Absent a recovery from third party sources, it appears unlikely that there will be any significant distributions available from the Liquidation Proceedings for the holders of PFL or FHH preference shares or warrants.
7:34 pm
July 5, 2020
Offline
If anyone is interested.it is an OPT OUT so unless you opt out you are IN.
This is just the beginning of the proceedings.
PACE will be given time to make a settlement offer, but PRRR has many options including litigation. They have handled many high profile cases like this.
This is why Pace is looking into what liability insurance they have because it is triggered by litigation.
Pace members are also concerned and have been asking if the credit union is “safe”.
It’s interesting that the court order does not define the investor plaintiff as including any employees of FHH or PSC involved with the investment such as brokers but probably will include regular PCU employees who also bought these shares.
From the court document:
4. THIS COURT ORDERS that, subject to the exclusive right of the Credit Union to present a settlement proposal as set out in paragraph 14 hereof, Representative Counsel be and is hereby permitted, but not directed, to take and to perform, for and on behalf of the Investor Claimants, all steps and all acts necessary or desirable to represent the interests of the Investor Claimants in these proceedings ("Representative Counsel Mandate") including, without limitation:
Doc#4833451v3
-3-
a. developing a process, in consultation with the Court Appointed Liquidators, for the investigation, identification, advancement and resolution of valid and provable Investor Claims;
b. addressing the Investor Claims, as part of these proceedings or in such related or consequential proceedings as may be approved by this Court, including, without limitation, by negotiation, compromise, arrangement, settlement, or litigation;
9:33 pm
May 19, 2020
Offline
retinvest said
My first post here. Just learning how to post properly. I am a PCU member and PCS client.
Thank you all for valuable discussion and information. Can someone please explain to me the meaning of this document. Thank you
Means law firm Paliare Roland Rosenberg Rothstein LLP ("Paliare Roland") is retained and appointed to represent the investor group (all members of credit union or not that bought PSC, PFH, FHH shares). They will be the representative counsel that will be part of the liquidation process to oversee the handling and distribution of the recovery fund.
11:31 pm
April 6, 2013
Offline
The Paliare Roland appointment was requested by the two liquidators, EY and MNP. The appointment is to represent the interests of some investors in the windup proceedings of these companies:
- Pace Securities Corp.
- Pace Financial Limited
- Pace Insurance Brokers Limited
- Pace General Partner Limited
- First Hamilton Holdings Inc.
- First Hamilton Financial Services Inc.
- First Hamilton Capital Inc.
- First Hamilton General Partner 2 Inc.
- First Hamilton Mortgage Brokers Inc.
Any recovery fund from PACE Credit Union is a separate matter.
6:47 am
May 19, 2020
Offline
Norman1 said
The Paliare Roland appointment was requested by the two liquidators, EY and MNP. The appointment is to represent the interests of some investors in the windup proceedings of these companies:
- Pace Securities Corp.
- Pace Financial Limited
- Pace Insurance Brokers Limited
- Pace General Partner Limited
- First Hamilton Holdings Inc.
- First Hamilton Financial Services Inc.
- First Hamilton Capital Inc.
- First Hamilton General Partner 2 Inc.
- First Hamilton Mortgage Brokers Inc.
Any recovery fund from PACE Credit Union is a separate matter.
I believe the rcovery fund is included-as how else are the lwayers going to get paid?
Also it is for ALL affected parties(except advisers(ors))it seems and unless you opt out you are in.
People have to uderstand this is a turning point.
Read the document carefully as this is going to happen fairly quickly as far legal stuff is concerned
9:40 am
April 6, 2013
Offline
The Paliare Roland lawyers will be paid by the investor claimants through a portion of the money the lawyers obtain for them in the windup:
9. THIS COURT ORDERS that the fees and expenses of Representative Counsel shall be paid out of the funds recovered for the Investor Claimants (if any) pursuant to or by virtue of this appointment, in accordance with terms to be agreed with the members of the Representative Committee and approved by this Court in the ordinary course, or, in the absence of an agreement, as directed by further order of this Court, having regard to the resources invested, risk assumed and results achieved by Representative Counsel, together with such other considerations as this Court determines to be relevant.
I've not seen any details of what the recovery fund is that the credit union has been musing about. The fund might be as just an advance of what the liquidator would get for those junk bonds.
Should it look like there would be $1.25/share for the preference share holders if the bonds were held to maturity in a few years, then the credit union might fund an $1/share advance of the $1.25/share. That would provide the preference share holders some funds to live on right now.
The $1/share advance would then be repaid from the $1.25/share proceeds from the junk bonds.
That guess is consistent with what the CEO said in the copy of the June 11 Globe & Mail article on the PACE Credit Union site:
…
PACE’s external review will look closely at “what happened with these shares, …” Ms. Dirks said. The credit union will also “explore creating a recovery fund” to provide interim relief to members facing hardship from financial losses.”
12:03 pm
July 5, 2020
Offline
JenE said
Still rooting for you Elaine, and all other investors affected by this Pace debacle. I called my local Pace branch, was told manager would call me back to discuss this situation - still waiting 4 weeks later! As soon as my GICs mature I’m out of there. Keep fighting!
Lots of non affected members are also concerned as the reputation of PACE is essentially in the toilet.
The first phase of this legal action is to see what can be recovered from the liquidation process, but the IIROC hearings are also coming up and PCU will try to use the findings from that to distance themselves from PSC management even though it has been clearly established that PCU owned and controlled PSC and paid the directors and for their liability insurance.
Even after this current legal situation is resolved, PCU will still be open to further class actions for misrepresenting these products that they sold to their own employees and members and even further lawsuits for stress and harm caused to investors many of whom are seniors.
This is just the first step in a long line of lawsuits that PCU will be facing but there are too many variables as a final valuation has not been reported and the various regulators are still investigating.
Even though the regulators do not impose financial penalties, their findings serve as evidence for further litigation against PCU.
James Hymas summed it up quite well when he wrote “ The whole thing stinks. PACE exploited the trust that customers will normally have in their credit unions – which, I venture to speculate, will normally be even greater than that held for banks – to provide referrals to their securities subsidiary.”.
There will also be plenty of more media coverage but one of the first articles exposing this scandal.
12:06 pm
July 2, 2020
Offline
You can read the Aug 10th update from the PCU..... found in your SPAM or JUNK folder..... or over here:
https://www.pacecu.ca/Personal/AboutUs/NewsandMedia/4PointPlanUpdates/
12:38 pm
August 1, 2020
Offline
In this update Barbara Dirks says "As outlined in the court filing, we are leading the development of a settlement package to present to the court during the fall timeframe. This is a positive step forward. This adds speed to the process so impacted members – you – can get the answers you deserve in a timely manner
and ensure you have your own appropriate legal representation".
If there is a group class action, how one joins class action? What are the benefits of class action vs individual legal representation?
12:42 pm
July 2, 2020
Offline
From the PACE Aug 10th newsletter:
The Contact Centre is reaching out – how to move your account
To facilitate moving your PSC accounts, our dedicated Contact Centre team is reaching out to assist you in the transition from LBS to a new broker. When the accounts have all been moved, EY can consider that part of their job complete.
You can reach the Contact Centre directly at: 1-877-588-7223 Local Number: 647-417-1515
Laurentian Bank Securities kicks me in the kahunas again....
Some might consider this insignificant in the big picture, but be aware Laurentian Bank Securities is hitting account owners with fees (in my case $150+) to transfer your account OUT. If your account balance is small (like mine, after the Preferred shares were removed), the transfer IN agent may not cover it too.
If your account balance is really small (< $150 after Preferred shares are removed ) you might consider just walking away from the account, vs. paying $150+ to have it moved.
My point is.... be sure you understand the fees, when you're transferring your PSC account OUT. Ask if you don't know !
1:33 pm
April 6, 2013
Offline
retinvest said
…
If there is a group class action, how one joins class action? What are the benefits of class action vs individual legal representation?
Paliare Roland's Class Action FAQ has an answer to the first question, as well as to other questions about class actions.
One won't be able to start a class action or any action right now. The August 6 court order blocks such attempts for the time being:
12. THIS COURT ORDERS that until Representative Counsel has completed the Representative Counsel Mandate or until this Court otherwise directs (the "Stay Period"), no proceeding or enforcement process in respect of Tolled Claims (each, a "Proceeding") shall be commenced or continued in any Court or tribunal against or in respect of the Applicants, or any of their related entities, including the Credit Union, or against LBS, or any of its related entities, except with leave of this Court, and any and all Proceedings currently under way against or in respect of the Applicants or their related entities, including the Credit Union, or against LBS, or any of its related entities, are hereby stayed and suspended pending further Order of this Court . .
6:11 am
April 6, 2013
Offline
For those with paid access to the Globe & Mail, Lawyer appointed to negotiate settlement for Pace clients reports the appointment of law firm Paliare Roland Rosenberg Rothstein LLP to represent investors, in those PACE Financial and First Hamilton Holding preference shares, for potential settlement talks.
Not really news for those following the developments here.
7:04 am
July 2, 2020
Offline
This isn't really new, either, given the Aug 6th Court Order. But I missed this yesterday. PACE CU also put out this Press Release on Aug 10th:
https://www.pacecu.ca/Personal/AboutUs/NewsandMedia/MediaReleases/
7:22 am
September 7, 2018
Offline
I have been reading with interest the articles in the media on this convoluted PCU/PCS etc. situation. I find it hard to believe that anyone would invest "their life savings" into this one issue Pref Share which was not redeemable, had no resale market, PARTICULARLY if these investors were "GIC only" types. Ok perhaps the salesmen were high pressure and convinced these people to go "all in", or these GIC only investors were too gullible and trusting, or they were greedy for 7%.
This situation emphasizes to me that investment portfolios should be diversified using an allocation formula to different investments (from safest - largest % of portfolio to least safe - smallest % of portfolio) so in the event one investment blows up/is lost, then the rest of the portfolio remains viable. It will be interesting to see how the situation gets resolved by the lawyers etc. and what compensation per investor will be.
Having had some losing investments over the years, I do sympathize with these investors and hope that they can recover and/or get some compensation.
11:15 am
July 2, 2020
Offline
canadian.100 & others holding a similar opinion..... I appreciate your position. For the "knowledgeable & informed investor", your comments are reasonable. I get it. There's nothing in the 5% or 7% Preferred product sold by PACE Securities to attract & retain the "knowledgeable & informed investor".
I suspect the individuals managing the hen house (Larry Smith, Phillip Smith, Joseph Thomson (CEO of PACE Securities, PFL, FHH, etc), Gerald McRae (Compliance Officer for PACE Securities), Ernie Eves, select investment advisors, and maybe others) had a plan. In the hen house are 40,000 members, some aging, some with reasonable equity in their homes, some with deep & not so deep savings, GIC only investors. By any other name, a target rich environment.
Now walk a mile in the "unknowledgeable & uninformed investor" shoes. Add in lies, purposeful deception, & falsified paperwork by the "fiduciary bound" investment advisor..... and one can land yourself a nice fish. ("Fiduciary duty" of your investment advisor ? Google it. What a joke (on me). I trusted the SOB.) The fish is told the Preferred product is:
- not redeemable, but we have a plan to "cash you out" whenever you want (total BS)
- 100% safe, same as GICs (they're not)
- paying a return of 5% or 7% (vs the 2-3% GIC)
- protected by CIPF (they're not) & regulated by IIROC (they're not). Thus your money is safe. (it's not)
oh, and be sure to omit informing the fish:
- the Preferred product is backed by junk bonds
- we're taking a 10% commission
- about the extensive use of "margin". Peak margin at LBS was $80m +
- we're active in the "options" market & losing money in it
- Joe Thomson, CEO of PACE Securities, is investing $1m of your money in his own company, FHH Capital
- and the list goes on
then, unbeknown to the fish, the investment advisor works with the Compliance Officer to develop an investment profile that:
- overstates (by 000's) your gross income, financial assets, & net assets
- defines your risk factor objectives as 70% high, 30% medium, 0% low (really ? Warren Buffett, I'm not)
- defines your time horizon as 6+ years (I might be dead by then)
The above won't apply to every "fish" in this boat. But I hope this helps to explain how this "fish" got there.
This was a well executed plan by the "long departed", select individuals noted earlier. I wonder were they are now ? Cayman Islands ?
and lucky her, the new CEO at PACE, Barbara Dicks, gets to mop up their mess.
6:49 am
May 19, 2020
Offline
IIROC has scheduled an appearance on September 10, 2020 to set a date for the disciplinary hearing in the matters of Joseph Anthony Thomson and Douglas Gerald McRae, of PACE Securities Corp. ("PSC").
3:55 pm
May 19, 2020
Offline
Ontario Superior Court of Justice decided to let PRRR come up with a plan to help the aggrieved members.
I shall try and post the link to the reasoning behind this
https://mail.google.com/mail/u/0?ui=2&ik=da01b9812a&attid=0.1&permmsgid=msg-f:1675930574527645384&th=174219fa62efc6c8&view=att&disp=inline
If that does not work then contact me.
On around pages 67 and onward there are stories of to different situations where harm was encountered.
The initials of the adviser(ors) are T.V. and H.M.
I am curious to know whether there were other adviser(ors) involved with other people.
If you don't mind ,can you just post initials,as names seem to be a taboo thing-even though they were used in the Judgement.
Were there only two rogue advisers or were there many more.
Inquiring mind wants to know!
8:26 pm
April 6, 2013
Offline
PACE Credit Union issued Affected Members Update #7 two days ago (August 24).
The updates are at PACE CU: Four-Point Action Plan Updates
Please write your comments in the forum.