Investor Profiles

in Bank, Rant, Registered Education Savings Plan

Sorry folks, another rant this week, thought I had got it all out of my system with the iPhone rant, but this one just arrived and I feel I must expunge it from my psyche or fear exploding later.

My Profile Hasn’t Changed!

I have run afoul of the TD Mutual Funds automatic transaction checking software (again). I put through another purchase request for my daughter’s RESP and received yet another automatically generated e-mail from my friends at TD/Mutual Funds, warning me that their Investor Profile of me is not

Transacation Cancelled

Transaction DENIED!!

up to date, and that I should call someone to get this updated right away (and this is a direct quote from the e-mail):

“…We value your business and have processed your trade. As a mutual fund dealer, we adhere to ”Know Your Client” (KYC) rules and learn essential facts relative to our client’s personal and financial circumstances to
determine if each order requested is suitable and in keeping with the client’s investment objectives. Please note that the investor profile information we have on record for you is outdated or incomplete and holdings may be out of line with your investment objectives and we ask for your assistance to update our records as soon as possible. We may not be able to process future transactions until your account information is
updated…”

For those who remember, I already updated a set of Investor Profiles already when I went through the saga of extricating money from my older kids’ RESPs, but this is one of my younger child’s RESPs, and my guess is that none of the Investor Profiles are linked to each other, so now I am in deep peril because this profile is not up to date.

I am astounded by the statement that they may not allow me to Deposit money into a savings vehicle due to it not fitting my investment profile? I am not attempting to buy $100 worth of Cotton Candy or the like (which I hope someone would point out was not a good investment), I am buying one of TD’s Mutual Funds, but evidently it may or may not fit my Investor Profile?

The crux of my frustration is not that TD is attempting to stop me from possibly making a financial mistake, which is noble of them (although I suspect it is mostly from their legal department, to make sure they do not get sued by someone who said, “They didn’t tell me I should buy a Mutual Fund made up of defunct High Tech companies”, but that is my opinion), it is the fact that they might stop me from Depositing money into an account, because a Static Profile of me is not up to date?

All of these profiles are out of date 5 minutes after I walk out of the bank, is my contention. My opinions and ideas are a fluid set of concepts, so stating that their latest snapshot of my Investor Ideals is not up to date is a mistake on their part.

If you re-read the quoted block, you will actually see that the statement is complete gibberish, because it has so many maybes involved it states nothing at all. They may or may not do something, some time if I don’t do something.

I know some folks will comment on this as me being overly snarky, but I do want to know, am I being unreasonable with my assessment of this? I think if they sent me a link to update this instead of having to call someone or worse going into my Local Branch, I think I might be less irate (I realize it is hard to believe).

{ 8 comments }

  • Diane December 18, 2010, 10:10 PM

    TD (and other banks) are following the IIROC rules and must do an investor profile every year on each investment account, except at the discount brokerage at TD Waterhouse.

    This happened to me with an account that is joint with my daughter (one I started many years ago). She kept getting letters; my rep at the branch kept sending messages that the profile had been done; it took over 6 months before the appropriate department caught on that it was done. Also, we lied on the profile- my personal profile is conservative due to my age, but the account is aggressive because it is $$ for my daughter.

    All banks will try to sell their pet products when they can. I usually just get what I want.

    Reply
  • LarryG December 17, 2010, 11:17 PM

    I don’t think this investor profile is legal; I think it is marketing. As soon as I finished mine (required annually) it was suggested I buy a similar asset mix, high MER “comfort portfolio” rather than the simple eFund Couch Potato mix that I wanted. All this is about scamming the extra 1% or so from people who are scammable.

    Reply
  • Vasile December 17, 2010, 9:06 AM

    I just got bitten by this. It seems that their customer profile is only linked to one account. Strange thing is that if your profile is “medium risk”, and you only have equity mutual funds in your account, they will plainly refuse to sell you more equity mutual funds, even if you specifically ask! The only options in this case are to go to TD Waterhouse (fess for them) or to redo your profile to accept higher risk. Just remember when asking the questions that they are for that account only! So if you keep the equity funds in the TD account and the fixed return investments in another one, the TD account profile should show that you are willing to accept high risks. It’s obviously not the personal investor profile, more like a “local” profile for that account.

    Reply
  • schultzter December 16, 2010, 12:17 PM

    Do we have to go through these with discount brokers? I don’t seem to think so? The line there seems to be “good investing or bad, we just take our commission.” Why with a mutual fund, where I get as much – if not less – advice than my discount broker do I always have to update my investor profile. And by now I’ve figured out how to answer the questions so that they’d basically let me buy cotton candy futures from Nortel – i.e.: they leave me alone!

    Reply
  • Canadian Income Tax December 16, 2010, 8:45 AM

    If your with the full serve or branch then yes, it’s in person.

    The rule is dumb but the compliance people who oversee the brain farts who give “advice” can only monitor single accounts.

    Reply
  • Canadian Income Tax December 16, 2010, 8:38 AM

    It’s not TD’s fault! The IIROC requires that the investor profile be set at the account level and not the customer level. this will happen when your actual portfolio is not in line with the set objective.

    Reply
    • bigcajunman December 16, 2010, 8:40 AM

      In this case it is mostly that I have not updated it in a year, but why can’t I just do that on line? Is it an IIROC rule that it must be done in person? If so, that is an ASS of a rule.

      Reply

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