Canadian Mutual Fund Dealer to Reimburse Portus Investors

Iqon Financial Inc. clients who invested in Portus Alternative Asset Management will be reimbursed the full amount of their capital investment, as a result of the allegations made by the Ontario Securities Commission that Portus violated a number of securities laws back in February of last year, resulting in the collapse of the Canadian hedge fund, according to the Toronto Star.

Manulife Financial Corporation, a Portus creditor, also offered its clients their money back, back in March of last year. Now, unlike other Portus investors, both Manulife and Iqon clients will not have to wait until Portus is "wound up and assets are distributed to creditors."

Yesterday the OSC announced that 57 investment and mutual fund dealers registered in Ontario agreed to pay about $12 million in restitutions for the commissions they received for referring clients to invest in Portus. A total of 64 dealers approved referrals that resulted in Portus investments. The referral of these clients to a complex and volatile hedge fund is an obvious conflict of interest since the brokers received commissions of 4% to 5%, a much larger compensation than if they had sold "low-risk investments."  

The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.