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Email this3:14 pm
January 10, 2017
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Norman1 said
That's irrelevant.The spousal RRSP would be held by your spouse. The spousal RRSP needs to be opened by your spouse and not you, the spousal contributor.
Full transaction authority is with the holding spouse who would be the annuitant of the RRSP. The designated spousal contributor can only make contributions.
It is relevant as my point was that one person can gift/fund for another person. This would be in keeping with gifting in Canada. Google states, "There is no "gift tax" in Canada. Any resident of Canada who receives a gift or inheritance of any amount, except from an employer, or as a tip or gratuity due to their employment, will not have to include this in their income."
4:53 pm
April 6, 2013
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Gift tax considerations are irrelevant as well.
As Loonie wrote, how do you intend provide your spouse's signature on required documents to open the spousal RRSP account and designate you as the spousal contributor?
5:24 pm
January 10, 2017
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Norman1 said
Gift tax considerations are irrelevant as well.As Loonie wrote, how do you intend provide your spouse's signature on required documents to open the spousal RRSP account and designate you as the spousal contributor?
I think there is loss of sight of the original question which was about avoiding having a related person needing to go into the broker office. The original question also included using mail. So as HermanH stated, his broker allowed the use of mail for opening of the file account for his mother. In similar fashion a spouse can sign any needed documents via mail, which can then be brought in or mailed in.
5:53 pm
April 14, 2021
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Lodown said can you say who the broker is?
Yes, we are in Alberta and GICWealth Mgmt Kevin Rotenberg is in Ontario. So, everything was done by mail. We had to include copies of ID with the application.
6:58 pm
January 10, 2017
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Thank you HermanH.
9:31 am
September 22, 2022
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New to the whole GIC broker scene and have some questions:
Q1) Apart from asking the broker verbally, how are you supposed to know the method/process whereby the principal and interest will be paid back to you upon maturity?
In the registration forms I've seen so far, including a blank Guaranteed Investment Certificate Application, it doesn't state anywhere how the money is supposed to be paid back. Is that normal? I assume if the broker is registered with the RDBA that it's probably safe to do business with them even if they don't explicitly write how the money will be returned at maturity--but I just find it strange that this isn't explicitly written down on the GIC application form that you sign.
Q2) As I understand it, GIC brokers do the middle work of finding and purchasing the best GIC option for you, in your name, from a bank or union. So, upon maturity of the GIC, is it normal for the bank or union to mail the cheque written out to you to the broker and then the broker forwards it to you? Why wouldn't the bank/union mail the cheque directly to you?
Q3) When registering with a new broker via mail, you are asked to fill out a "Client Information and Consent Form" and a "Client Identity Verification Form". The broker also says that along with photocopies of your IDs, to send them a cheque addressed to yourself for the amount of the GIC you want to purchase. The broker says that upon receipt of this information, they will then fill out a GIC application form and send it you to sign.
My questions is: Is it normal for brokers to ask you mail them cheques for the amount of the GIC before you sign the GIC application form?
(The broker says that because rates can change between when you mail documents and they receive them, that that is why they ask for the cheque upfront at the same time you fill out client info and client verification forms.)
Q4) What are the complaint/recourse options available to someone if they have have been frauded (or similar) by a broker? (Eg. The broker steals your money. Eg. #2 Invests it very differently than instructed and expected, such as perhaps in mutual funds when you were expecting they would purchase a GIC.)
Q5) The broker I spoke with (who I'd be doing business with via mail for sending documents) says it takes about 3-4 weeks to send me the GIC certificate after it is purchased from the bank/union. Does that sound normal?
6:57 pm
September 22, 2022
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For those that have bought GICs through deposit brokers before, how normal is this?
SITUATION:
You give the broker a cheque addressed to yourself. You sign all the paper work with the broker and they tell you they will be mailing the cheque to the credit union for the GIC. When it is cashed, you look at the cheque scan image through your bank's webportal. On the front of the cheque, you've made it payable to yourself. On the back, there is a stamp which includes some identifying info on the top (which is largely ineligible because of poor quality of the ink stamp) and also includes two blank underlines labelled "PER" over which someone has endorsed the cheque by hand-printing your name on the first line and then on second line has handwritten their own initials.
MY QUESTION:
If the cheque is addressed to myself for a GIC that's supposed to be in my name, why would someone need to endorse it in another person's name?
And also, how common it is when dealing with legitimate brokers for someone else to endorse a cheque you made out to yourself to yourself to someone else?
The deposit broker organization I used has a good reputation (it's one of the ones spoken highly of on this website) and the broker I used is registered with the RDBA. So, I have no immediate reason to suspect fraud. However I am also wary as this is my first time using a deposit broker.
My presumption was that if the broker needed you to sign the cheque in someone else's name (eg. an organization), that they'd tell you to do that at the start.
Even if I get mailed a GIC certificate that says the investment is in my name, does the fact that the cheque was endorced to someone else still mean they money technically is not currently mine anymore and that I'm basically reliant on the assumed honesty of the broker and credit union to ensure its eventually paid pack to me at maturity? (After all, anyone can print a fancy certificate but it doesn't mean the certificate is legitimate.)
7:41 pm
October 21, 2013
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"Per" is a word, not a symbol or acronym. The original Latin from which it dervies means"through", and that is your clue. Someone representing the FI where you have bought your GIC has endorsed your cheque on your behalf in order to deposit into your account. So it essentially means"Mavrick, signed by ABCBank on his behalf by (through) JoeBankRep". The signer is authorized by said bank to receive your deposit.
I don't think there is anything to worry about.
8:05 pm
April 6, 2013
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When a cheque is deposited into an account with a name that matches the payee, no endorsement is required.
The endorsement block on the top right of the back of the cheque is where an endorsement should go. But, other things, besides endorsements, can be written there as well when an endorsement is not necessary.
Also, your GIC money is not kept in your account. You actually turned the money from the cheque over to the GIC issuer who will lend it out as soon as possible. In return for your money, the GIC issuer has given you a promise (the GIC) to return the same amount of money back to you at maturity along with interest.
That's why the deposits are actually a liability and not an asset of the credit union or bank.
9:43 pm
October 21, 2013
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The GIC IS your account. Whether it goes out the door again in loans is immaterial to the deposit process.
I can attest that some government cheques MUST be endorsed even if paid into payee's account, regardless of what the rules may say.
Let's not get stuck on language that is hard to understand.
4:40 am
March 30, 2017
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Norman1 said
When a cheque is deposited into an account with a name that matches the payee, no endorsement is required.
Isn’t it true a cheque can only be deposited into an account that matches the payee’s name anyway ? The only exception being a cheque with name written as ‘cash’.
Are you saying even if I write a check to myself with my name on it, someone can legally deposit it into another account with a totally different name WITHOUT me endorsing the back of the cheque myself first ?! If that is true, that is NOT good at all.
5:42 am
September 11, 2013
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Saying that no endorsement is needed when depositing a cheque to an account where both bear the same name is not at all implying/saying that a cheque can be deposited to any account without endorsement by the payee.
I've always found it useful to remember that when I give money to someone for a GIC or HISA account that that money is long gone, it's not "in my account" at all. What I now have in lieu of my money is a piece of paper (or an electronic blip, etc) that is a promise to pay me an amount, either at some point in time or on demand. I've bought a promise.
Very different than when I exchange money for an apple, real estate, a vehicle, common shares, etc.
7:44 am
April 6, 2013
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savemoresaveoften said
Isn’t it true a checque can only be deposited into an account that matches the payee’s name anyway ? The only exception being a cheque with name written as ‘cash’.
…
Not true. Cheques say "Pay to the order of" and not "Pay to".
Payee Alice can order the cheque to be paid to the order of Bob. Bob can then order the cheque to be paid to the order of Cindy. Cindy orders the cheque to be deposited to the credit of her bank account. Cheque is then deposited to the credit of Cindy's bank account and not to the credit of Alice's account.
Cindy's bank presents the cheque to the drawee bank. Drawee bank transfers the funds from its Bank of Canada clearing account to the Bank of Canada account of Cindy's bank in spite of the fact that no-one ordered the cheque to be paid to the order of Cindy's bank.
7:56 am
March 30, 2017
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Norman1 said
savemoresaveoften said
Isn’t it true a cheque can only be deposited into an account that matches the payee’s name anyway ? The only exception being a cheque with name written as ‘cash’.
…Not true. Cheques say "Pay to the order of" and not "Pay to".
Payee Alice can order the cheque to be paid to the order of Bob. Bob can then order the cheque to be paid to the order of Cindy. Cindy orders the cheque to be deposited to the credit of her bank account. Cheque is then deposited to the credit of Cindy's bank account and not to the credit of Alice's account.
Cindy's bank presents the cheque to the drawee bank. Drawee bank transfers the funds from its Bank of Canada clearing account to the Bank of Canada account of Cindy's bank in spite of the fact that no-one ordered the cheque to be paid to the order of Cindy's bank.
ok, but since Bob's name is on the cheque, only Bob can order it to be paid to Cindy. Or the crook (Cindy or accomplice) has to impersonate Bob for it to happen.
So when I write a cheque to myself with my name on it as the payee, someone has to impersonate me in order to pay it to someone else thus "steal" my money, if thats the intention.
8:18 am
September 11, 2013
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Interesting. In practical terms what documentation would Cindy need for her bank to accept the deposit to her account based on a cheque made out to Alice?
4:14 pm
September 22, 2022
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Loonie said
"Per" is a word, not a symbol or acronym. The original Latin from which it dervies means"through", and that is your clue. Someone representing the FI where you have bought your GIC has endorsed your cheque on your behalf in order to deposit into your account. So it essentially means"Mavrick, signed by ABCBank on his behalf by (through) JoeBankRep". The signer is authorized by said bank to receive your deposit.I don't think there is anything to worry about.
I appreciate your feedback.
I took another look at the back of the cheque image. The stamp is very hard to read but upon another look I think it says "SOR" on the fist line (and someone wrote my name to the right beside that) and then "PER" on the second line (where they initialled to its right). "SOR" means 'source' maybe?
Even so, I think your explanation still applies if I'm understanding you correctly.
6:52 pm
October 21, 2013
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That sounds about right, but I have no idea what SOR means. "Signature of Representative"??
8:15 pm
April 6, 2013
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Those don't look like an endorsement. It's more likely processing info, recording the name on the GIC application form and initials of the person who verified that the name and amount on the application matches those of the cheque.
8:16 pm
April 6, 2013
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Bill said
… In practical terms what documentation would Cindy need for her bank to accept the deposit to her account based on a cheque made out to Alice?
See separate thread Cheque endorsements.
11:14 am
September 22, 2022
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Loonie said
That sounds about right, but I have no idea what SOR means. "Signature of Representative"??
Nope, that can't be right because on the first line, someone wrote my name.
See the attached cheque image (with sensitive info removed).
Please write your comments in the forum.