Page 11 - CCCA Magazine Summer 2014

{ FiNaNCial literaCy } “ I found it interesting that others looked into less than ‘mainstream’ options for ” their investment choices mainly as a result of efective advertising. The website was designed such that pose to Canadian investors. Canadian se- banking, securities and fnancial services, if potential investors clicked on “invest curities regulators felt it was important to in particular, have unique experience that now,” it took them to an educational web- address these tactics head on and educate may be of beneft to other counsel and site (created by the CSA) that explained potential investors in the same spaces where the general public. While fnancial literacy about fraud prevention and summarized fraudsters solicit their victims. education among legal professionals may 5 the various different ways to spot invest- Many of you reading this article would seem redundant to some, as high-income ment fraud. say you would never invest in a company investors, we have become ever-increasing Some of those tips included: featured and promoted online. However, targets of such scams. ■ Guaranteed high returns, no risk the results show that many still do. You CCCA with support from CBA is bring- ■ High pressure sales tactics to invest need not look further than the investment ing the discussion on fnancial literacy di- right away fraud scandals of the last fve years to see rectly to the legal community through var- ■ Tax-free and offshore that many spurned investors turn out to ious types of programming. Check CBA’s ■ Slick appearances that don’t measure up be wealthy professionals looking for a website for sessions dealing with fnancial ■ Lack of quality information good return in an era of low interest rates. planning for lawyers as well as providing 3 The CSA touted the campaign as a suc- The CSA’s campaign demonstrated that advice to vulnerable clients. cess. “We received an increased rate of re- online investing is growing and that inves- The BlueHedge Investments initiative sponses this year with online promotions tors are targeted at an increasingly higher was a creative way to draw attention to enticing close to 13,000 potential inves- rate by sophisticated con artists. The point investor and fnancial literacy education. tors to visit BlueHedge Investments in was to show how complex investment The hope is that this discussion will also only six weeks. Feedback on the campaign fraud can be, and start the conversation take place in the legal community. ❚ was overwhelmingly positive.” among investors and their advisers. 4 Bill Rice, Chair of the CSA, and Chair and CEO of the Alberta Securities Com- Financial literacy education Alena Thouin is general counsel and corporate mission, further noted that: For legal counsel providing advice to cli- secretary, Alterna Savings and Bank, and chair of CCCA’s fnancial literacy subcommittee. Potential investors need to be more wary ents seeking to lend funds or participate in when dealing with investment opportunities sophisticated investment transactions, em- they see advertised online. Our enforcement phasizing due diligence is second nature. 1 Csa investor education Committee, Annual Activity Report, 2012, p. 2, http://www.securities-administrators.ca/ teams across the country have frsthand As such, with the rise in increasingly com- uploadedFiles/general/pdfs/Csa%20english%20Final%20 knowledge of how unscrupulous promoters plex investments and online promotion of june%207%202013%202.pdf?n=8286 2 http://www.bluehedge.ca/ are turning to the internet to market their opportunities, the involvement of the legal 3 http://www.bcsc.bc.ca/release.aspx?id=14412 fraudulent investment opportunities and profession in fnancial literacy education 4 Supra note 1 the threat these online investment scams is vital. Those who practice in the areas of 5 http://www.bcsc.bc.ca/release.aspx?id=14412 Canadian Corporate Counsel assoCiation | CCCa-aCCje.org 11