By Staff | July 19, 2006 | Last updated on July 19, 2006
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(July 19, 2006) The British Columbia Securities Commission has issued a notice of hearing alleging that Ian Gregory Thow violated securities laws and perpetrated a fraud on B.C. investors.

The notice says between January 2003 and May 2005 Thow told clients he was able to invest money for them in various securities, including mortgages and shares of the National Commercial Bank of Jamaica, but then used some or all of his client’s money for his own personal use.

Thow filed for bankruptcy protection in Seattle in September 2005 after crossing the border into the United States with a quantity of household effects, using a U.S. birth certificate, according to the RCMP Integrated Market Enforcement Team.

In a separate and unrelated release, the BCSC also announced it has reprimanded a Richmond, B.C. exchange contracts dealer and its chief financial officer for compliance failures, including filing misleading financial information to the regulator.

Quantum Financial Service and Phillip Moy, Quantum’s CFO, agreed the firm would pay $50,000 and must file monthly reports of its risk adjusted capital and financial records to the BCSC for one year. As well, Moy can not act as an officer or director of any company whose primary business is trading in or advising on securities or exchange contracts for at least two years.

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Dynamic merges funds to create new Advantage Bond Fund

(July 19, 2006) Goodman & Company, Investment Counsel announced the launch of the Dynamic Advantage Bond Fund, a core fund managed by Michael McHugh, that will provide equal exposure to government bonds, investment grade corporate bonds, including commercial mortgage backed securities, real return bonds and high-yield bonds, using a 4 x 25% allocation model. The manager may also invest up to 10% of the fund’s assets in floating rate notes and convertible debentures.

Quarterly distributions will be fixed at 4.5 cents per unit for Series A shares, representing a yield of 3.6%, based on the initial $5.00 net asset value. Distributions will be reviewed annually, beginning in December 2006.

The fund was created by the merger of the Dynamic World Convertible Debentures Fund and the Dynamic Corporate Bond Fund.

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Canadian VCs prefer to stick close to home

(July 19, 2006) Home country bias is alive and well among venture capitalists in Canada, with more than half of Canadian respondents to the Deloitte 2006 Venture Capital Survey saying they have no plans to expand their investments outside of the country over the next five years.

Of the 58% who said this, 33% say there is adequate deal flow in their existing markets while 22% say contractual and legal restrictions prevent them from looking at opportunities abroad.

“Canadian VCs and private equity groups have chosen to focus on North America and have not developed their expertise in emerging markets,” says Deloitte partner, Mike Badham. “As the VC industry around the world continues to move towards global investing networks, Canadian VCs should start reevaluating their strategies to capitalize on international opportunities.”

Among those who do plan to expand their international investments the United States, China and the United Kingdom were cited as the top three investment destinations by 27%, 23% and 20% of respondents, respectively. Higher quality of deal flow and access to quality entrepreneurs were named by 67% of respondents as their primary reasons for investing in the U.S., while 100% said emergence of an entrepreneurial environment in a non-traditional location, followed by 50% who said access to foreign markets were the primary reasons for pursuing investments in China.

Looking forward, VCs say energy and the environment, clean technologies, healthcare services and consumer business sectors are areas most likely to enjoy an increase in Canadian VC investments during the next five years.

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SSGA expands alternative strategy capabilities

(July 19, 2006) State Street Global Advisors is expending the company’s ability to provide alternative strategies.

After hiring new high profile investment professionals including Jonathan Chanis, formerly of Caxton Associates, Henri Fouda, formerly of Mellon Capital Management and Todor Georgiev, formerly of KBC Alternative Asset Management, the company plans to offer a wide variety of absolute return strategies including currency, long/short, market neutral, fixed income arbitrage and equity hedge/directional strategies.

The team, lead by Chris Woods, will report to Sean Flannery, chief investment officer for North America and Jane Tisdale, senior managing director of absolute return strategies.

The company has also entered into a new licensing agreement with AlphaSimplex Group LLC, a Cambridge Massachusetts based quantitative investment management company that will provide asset allocation software that “transcends traditional asset allocation analytics which don’t typically take into account some of the unique risk factors faced by these strategies,” says Woods. “This initiative signals a high level of commitment to alternative investment strategies and allows us greater flexibility to build standard and customized alpha investment solutions for our clients.”

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Long term rates help Canadian pension plans: Mercer

(July 19, 2006) Canadian pension plans got a boost in the first half of 2006, despite negative stock market returns posted in the second quarter of the year. Long term interest rates rose by more than half a percent since the end of 2005, fuelling the improvement.

“Although bond portfolios have suffered, the decline in the value of pension liabilities makes all the difference,” says Paul Forestell, retirement professional leader at Mercer.

The Mercer Pension Health Index, however, shows that plans still haven’t completely made up losses sustained in 2005. “These improvements won’t help most plan sponsors make lower contributions until 2007, assuming the gains can be maintained for the next six months, but many plan sponsors are hoping that they’ve seen the bottom and this is the beginning of a return to higher long-term interest rates.”

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OSC extends cease trade order against Grossman and Shuman

(July 19, 2006) The Ontario Securities Commission has extended a temporary cease trade order against First Global Ventures, its president Allen Grossman and Alan Shuman until September 12.

Similar cease trade orders are in effect in Saskatchewan, Alberta and New Brunswick. In May, the Newfoundland and Labrador Superintendent of Securities ordered that First Global, Maitland and others be prohibited from trading in securities in that province.

According to a revised statement of allegations filed by the OSC, First Global Ventures was incorporated on March 31, 2006 in Panama, but the commission says this was only a virtual office, with calls to being forwarded to Ontario. The commission further alleges that it has not issued a prospectus receipt to the company to qualify the sale of First Global shares in Ontario.

A statement posted on the company’s website in May states that “one of the many Canadian securities commissions have seen fit to make frivolous allegations about FGV and its business practices and to issue their version of a cease trade order,” adding that the company expects all other jurisdictions to follow suit in the “same misguided direction.”

Neither First Global, nor Grossman, nor Shuman, an officer of the company, are registered with the OSC in any capacity.

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The staff of have been covering news for financial advisors since 1998.