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Pace Securities
May 24, 2020
5:33 pm
Yaftica
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Guess there's no need to watch my mailbox for the letter E&Y sent out on Friday it is posted here:

https://documentcentre.eycan.com/eycm_library/Pace%20Securities%20Corp/English/Notice%20to%20Customers/EY%20Letter%20to%20PSC%20customers%20May%2022,%202020%20Final.pdf

So - waiting game then to see what the value of these preferred shares will be once the transfer is completed to the new carrying broker. Maybe it will actually be $1.62 per share when the wind up order commenced, maybe it will be zero, who knows. Doubt Laurentian Bank will say anything on that matter wonder if it is even worth it to call them this week... sf-frown

May 24, 2020
7:30 pm
Norman1
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There's no point contacting the carrying broker Laurentian Bank Securities, Yaftica, to obtain the value of those preferred shares.

The PACE Financial Limited preferred shares don't actually trade. So, the carrying broker can't provide you a quote on them. According to a letter Elaine posted, any price you have seen on the PACE Securities account statements is just an estimate that PACE Financial supplied every month:

Our Reporting

PFL preference shares are not listed securities. In the absence of a price from an exchange the custody system used by Laurentian Bank Securities Inc requires a manual update every 90 days. We estimate the value of the preference shares on a monthly basis ND REQUEST lbs UPDATE THE SYSTEM ACCORDINGLY.

May 27, 2020
9:10 pm
Jon
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My condolences to your losses, Yaftica and Elaine. I have a feeling that you may recover some of your losses as my actively managed US junk bond mutual fund have recovered more than half of its losses (thanks to QE), assuming Laurentian Bank Securities doesn't force Pace Financial to do a fire sell at rock bottom price previously.

May 28, 2020
8:31 am
sevenup
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I've been reading this forum ever since we were told about our Pace Securities investment wind-up. We have our ENTIRE life savings invested, including our RRSPs that we've been saving for 15+ years, it's a very large amount (to us anyway). We bought PF preferred shares in 2018 and moved our RRSPs from CIBC to Pace just in November 2019. Worst decision of our life!

When we spoke to our advisor in March, he said "everything is going great, PSC is doing well"! We had no reason to think anything was wrong or that we need to act accordingly.

We are distraught about this decision and we want to act, at the very least, bring media attention to it.

I have left message for EY, no response. We spoke the Bank manager at the Pace Credit Union (Mississauga) and asked to get some answers and she said an "executive" will call us, so far we have not heard from anyone.

I was hoping we can band together and come up with some ideas together? If you are affected, can you personally message me and perhaps we can share our contact and talk?

We haven't been able to sleep, think clearly or just function normally since we heard. There is more going on with this PSC wind up than what's disclosed.

May 28, 2020
8:32 am
AltaRed
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What does Laurentian have to do with this? As I understand it, they are just the broker and called in the margin loan as any broker would at the time.

May 28, 2020
9:10 am
Jon
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AltaRed said
What does Laurentian have to do with this? As I understand it, they are just the broker and called in the margin loan as any broker would at the time.  

The gist of what I am saying is if Laurentian force Pace to sell all the junk bond at rock bottom price because of the margin call, than the victim will not benefit from the rebound in the price of junk bond.

(Sounds rather condescending does it)

May 28, 2020
1:00 pm
Shelley Mackie
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Hi I have been reading these post. I have just started investing with Pace Securities. I'm not sure what will happen but I'm not happy with what is happened here. I did leave a message with E&Y when we first got notified and did get a call back saying they are working hard at getting a new broker and that you would hear from us. The last thing i found on the EY Website link was the letter on May22nd.
I believe something else is happening and don't agree that Pace Credit Union is okay. Pace Credit Union knew something or had to why i just think why. Yes I feel everyone's pain as I have all my investments with them.

Shelley

May 28, 2020
1:29 pm
Yaftica
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Its taken me a couple of weeks to calm down and look at this rationally as hard as it is to process, understand what has happened and how I am affected, then explain it my family. For the majority of the account holders with PFLtd the equation is a blip in the sense that there will be no access to accounts while E&Y is liquidating and those portfolios are transferred in kind to a new broker.

As I have come to be aware, I am one of the unlucky persons who held these preferred share options & my equity stake there is in limbo. It could be worth the closing value of those shares at the point of liquidation, or zero. I'm unsure when that answer will come or from whom technically. I remain hopeful that Pace Credit Union however is trying to turn over stones and determine the exact impact to current members as well. In that sense I understand now as shock has worn off that there is nothing which can be done at the moment other than to await the dust to further settle and allow those who are doing the work to wind up the company complete their task and presumably provide a final report on same to the CU.

In fairness the best thing to do is to provide as much information possible to the organization in hopes that there are investigative measures underway to formulate a proper response. Patience is certainly difficult under these circumstances but better to practice that rather than despair especially for those around you. Much easier said than done however.

May 28, 2020
3:13 pm
Norman1
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Yaftica said

As I have come to be aware, I am one of the unlucky persons who held these preferred share options & my equity stake there is in limbo. It could be worth the closing value of those shares at the point of liquidation, or zero. I'm unsure when that answer will come or from whom technically.…

The answer will come from PACE Financial's liquidator, E&Y. Once E&Y has liquidated PACE Financial's assets and then paid off PACE Financial's creditors, like Laurential Bank Securities, and expenses, it will look at the money left and distribute it to the PACE Financial shareholders.

May 28, 2020
3:17 pm
Norman1
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Shelley Mackie said
Hi I have been reading these post. I have just started investing with Pace Securities. I'm not sure what will happen but I'm not happy with what is happened here. I did leave a message with E&Y when we first got notified and did get a call back saying they are working hard at getting a new broker and that you would hear from us. …

If you didn't invest in those PACE Financial preferred shares, then it will just be an inconvenience, until the contents of the PACE Securities brokerage accounts are transferred to a new broker.

May 28, 2020
4:57 pm
Elaine
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I hve just received notice from the security investigator that my name does not show up so I need to work with PACE CREDIT UNION or hire a lawyer.I guess to sue PACE CREDIT UNION as there is nothing about me on the securities side.
I hate being scammed.
How can someone walk into a credit union to buy a GIC and walk out 100 grand poorer-and then be told to hire a lawyer?
The more I see the sicker I get.
Only 300 members got conned so no biggie.
Not even worth calling to give them a heads up.
And they would not have called me anyways because even PACE had trouble finding my name.

May 28, 2020
5:43 pm
Norman1
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Elaine said
I hve just received notice from the security investigator that my name does not show up so I need to work with PACE CREDIT UNION or hire a lawyer.I guess to sue PACE CREDIT UNION as there is nothing about me on the securities side.
I hate being scammed.

Perhaps your PACE Financial preferred shares are actually registered directly in your name instead of being registered in PACE Securities' name and held in a brokerage account there.

On the T5 slips for those PACE Financial preferred share dividends, does it say the slip is from PACE Securities or PACE Financial?

May 28, 2020
6:46 pm
Bud
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What junk bond companies did they own

Tone sounds a bit like ABCP back in 09 on a smaller scale
https://www.benefitscanada.com/investments/asset-classes/abcp-investors-confront-crawford-2527

What was the abcp outcome i think most got most of their funds back.

https://www.google.com/amp/s/business.financialpost.com/news/fp-street/abcp-fiascos-silver-lining/amp

May 28, 2020
7:15 pm
Yaftica
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Perhaps your PACE Financial preferred shares are actually registered directly in your name instead of being registered in PACE Securities' name and held in a brokerage account there.

On the T5 slips for those PACE Financial preferred share dividends, does it say the slip is from PACE Securities or PACE Financial?  
//////////////////////////////////////////

Pace Credit Union issues a T5 annually (Payer's name and address Pace Savings & Credit Union Ltd 8111 Jane St etc).

Pace Securities Corp has issued me a Trading Summary Statement account which lists the Securities and Description of Same. If the client held the shares in question it is clearly indicated on all documentation as Pace Fin Ltd-A 5% NV PFD. Also received a T5008 Statement of Securities Transactions with same indications. Also an Investment Income Summary Statement with same indications, and finally a T5 Statement of Investment Income (Payer's name and address of Pace Securities Corp 50 Burnhamthorpe Rd etc).

The business cards I'm holding from my investment advisor use the Pace Logo followed by Securities Corp. The business address on it is that of Pace Credit Union, 8111 Jane St. etc. Probably irrelevant.
PFltd.jpg

May 28, 2020
8:03 pm
AltaRed
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Jon said

The gist of what I am saying is if Laurentian force Pace to sell all the junk bond at rock bottom price because of the margin call, than the victim will not benefit from the rebound in the price of junk bond.

(Sounds rather condescending does it)  

Earlier in this thread, the contents of the Pace letter said exactly that. So yes, Laurentian did call the margin loan during the crisis and Pace had to sell junk bonds at a major loss to cover it. IOW the damage has been done (in March? - I didn't go back in this thread to confirm timing). At this point, I believe the only upside would be increases in the market value of the junk bond assets that remain, less wind up costs such as E&Y.

May 28, 2020
10:02 pm
Norman1
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Yaftica said

Pace Securities Corp has issued me a Trading Summary Statement account which lists the Securities and Description of Same. If the client held the shares in question it is clearly indicated on all documentation as Pace Fin Ltd-A 5% NV PFD. Also received a T5008 Statement of Securities Transactions with same indications. Also an Investment Income Summary Statement with same indications, and finally a T5 Statement of Investment Income (Payer's name and address of Pace Securities Corp 50 Burnhamthorpe Rd etc).

The business cards I'm holding from my investment advisor use the Pace Logo followed by Securities Corp.…

Thanks for that, Yaftica. From the statements and tax slips, your PACE Financial preferred shares are held in your PACE Securities brokerage account.

Not sure about Elaine's shares though. She is definitely an owner of the same preferred shares as she received a PACE Financial shareholder's letter. However, she reported that PACE Securities couldn't locate a brokerage account for her! sf-surprised

The 5% per annum dividend on $100,000 of those preferred shares is definitely over the $50 exemption for T5 slips. Elaine would have received T5 slips for such dividends. The T5 slips would indicate who was paying her those dividends and perhaps also include some kind of account number.

May 29, 2020
5:47 am
Elaine
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Bud said
What junk bond companies did they own

Tone sounds a bit like ABCP back in 09 on a smaller scale
https://www.benefitscanada.com/investments/asset-classes/abcp-investors-confront-crawford-2527

What was the abcp outcome i think most got most of their funds back.

https://www.google.com/amp/s/business.financialpost.com/news/fp-street/abcp-fiascos-silver-lining/amp  

For me it is the deception.I never invest in the market -I always buy GIC's as I know I am not good with losing money I worked for.So I always protect my principal.

May 29, 2020
6:07 am
Elaine
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Norman1 said

Elaine said
I hve just received notice from the security investigator that my name does not show up so I need to work with PACE CREDIT UNION or hire a lawyer.I guess to sue PACE CREDIT UNION as there is nothing about me on the securities side.
I hate being scammed.

Perhaps your PACE Financial preferred shares are actually registered directly in your name instead of being registered in PACE Securities' name and held in a brokerage account there.

On the T5 slips for those PACE Financial preferred share dividends, does it say the slip is from PACE Securities or PACE Financial?  

hI norman-
The T5 slip says the payer's names is Pace Financial limited on Burnammthorpe-this is the one from 2018 (as it was the first one I found) just wanted to clear that up right away.

May 29, 2020
3:13 pm
Norman1
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Elaine said
hI norman-
The T5 slip says the payer's names is Pace Financial limited on Burnammthorpe-this is the one from 2018 (as it was the first one I found) just wanted to clear that up right away.

Thanks, Elaine. See if the other slips also mention "PACE Financial" instead of "PACE Securities". If they do, then it looks like you and Yaftica are holding those preferred shares differently.

Perhaps the only investment you bought through PACE Securities were those PACE Financial preferred shares and not for an RRSP or TFSA. So, PACE Securities ordered the shares for you, had them registered in your name, and delivered to you, instead of opening an account to hold the shares on your behalf.

If that is the case, then you will be dealing with PACE Financial directly and not indirectly through PACE Securities. The T5 slip or a tearoff part of the page with the slip will have a shareholder account number.

I think Yaftica also bought some mutual funds. So, PACE Securities opened an account and put the mutual funds and those PACE Financial preferred shares into the account.

May 29, 2020
5:27 pm
Yaftica
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As my thought process becomes more clear these days while the initial shock wears off... Presumably the differences Norm relates is what the financial institution or forensic accountants are trying to narrow down in the interim and understandably this may take some time to pinpoint.

It is likely well understood already where the customer losses have occurred (against exactly what type of investment line). What also may not be clear quite yet is which customers are caught up in those holdings and how they arrived there, everyone's circumstances may have differences. What methodology the brokers were using to sell these shares, how much they controlled, what criteria was used to determine eligible customers, the training and direction they received to market and or allocate peoples funds into these risk levels, many facets of the investigation will take some time to understand before other things can be considered with respect to the potential for solutions, resolution, mediation, many additional terms can be used I'm sure. It is too late to bring this receipt in the return period has expired. I haven't dug out all my paperwork to pour over it what's the point, I already know I owned these assets I saw their value plummet into April on my statement. How that exactly occurred is wildly open for debate at some point in the future I'm sure as well.

Someone has to be given the benefit of time and it is E&Y to complete the work they are appointed to do and Pace Credit Union I suppose to complete an investigation, much more than $ appears to be at stake yet again. There isn't much more to consider at this point but how to resist, have patience for the time being and focusing on gifts in life. I have family who rely upon my emotions to not be beaten down and thats my biggest risk consideration. Everyone affected would do well to think about their own for now but always easier said than done.

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