Berkshire communicates to clients on Portus

By Doug Watt | May 4, 2005 | Last updated on May 4, 2005
2 min read

(May 4, 2005) After months of silence, Berkshire has finally sent a memo to clients whose advisors referred them to Portus, the hedge fund firm currently under investigation by Ontario regulators.

Although the memo states that Berkshire is concerned about the ongoing situation at Portus, it stops short of offering clients any protection, such as the guarantee recently outlined by Manulife.

Clients whose Manulife advisor referred them to Portus can exchange their investment for either a guaranteed principal-protected note, a GIC, or a cash payment. The note and the GIC have been specifically created by Manulife for Portus clients.

Berkshire also claims that the number of clients referred to Portus by Berkshire advisors has been exaggerated. Of the estimated 26,000 Portus clients, it appears that Berkshire advisors referred approximately 2,200, Berkshire says, “Which is less than 9% of all Portus clients.”

Berkshire says although it has chosen not to speak publicly about Berkshire, “we can assure you that that Berkshire has been taking an active role outside the public eye.”

“For example, Berkshire has been fully cooperating with the regulators in the course of their investigations, has been proactively reviewing and assessing the receivership proceedings and has been working toward developing an industry initiative to address the Portus situation.”

Still, Berkshire’s reticence to go public on the problems at Portus has frustrated a number of advisors. They are also under a strict media gag, sources say, preventing them from saying anything about Portus.

But there has been some chatter on the subject in’s Talvest Town Hall, with some advisors suggesting that Berkshire parent, AIC, and its founder Michael Lee-Chin have other things to worry about that far outweigh any concerns over Portus.

“I do not see Michael Lee Chin spending his money to cover investor losses [resulting from Portus],” wrote one advisor in the Talvest Town Hall. “He has his AIC fund investors to re-imburse first.”

AIC has been in net redemptions for about three years. During that time, its assets under management have fallen by more than one-third from a peak of $15.4 billion to about $9.5 billion at the end of last month. In April, AIC’s net redemptions were $312 million, the worst in the industry.

Related News Stories

  • Advisors unfairly targeted says Advocis chief
  • Portus fallout: How advisors have been affected
  • Filed by Doug Watt,,


    What do you think about Berkshire’s response to the Portus matter? Share your thoughts about this topic in the Talvest Town Hall on

    Doug Watt