PACE credit union scandal

[billie69]

This is a scary article about how a large number of Pace credit union members thought they were being sold member preference shares when the securities division deceived themand old them high risk investments in a junk bond fund.
Now the credit union is looking into a way to make their investors whole so they don’t get hit with a class action lawsuit.
I know some folks who work there and even employees bought in and are super angry.
Ernie Eves was a director of here too.
Here’s a link to the story on the Globe. Apparently there will be a lot more coverage coming soon.

PACE credit union launches investigation of improper investment sales by brokerage division

Investors claim high-risk preferred shares were promoted as a safe investment

www.theglobeandmail.com

Apparently Pace credit union was placed under administration and the whole board and ceo got fired and this shady sale was perpetuated by them. Hopefully the new board will fix the mess they inherited or else it could be very bad for the credit union.

Former MPP Frank Klees makes millions from PACE Credit Union - Gordon Prentice at Large - Politics in Newmarket

Frank Klees former MPP and his relationship with PACE credit union

www.shrinkslessorsquare.ca

I also noticed a very angry blog about this where even apparently even the credit union admits to deception.

Pace Securities | Page 19 | General financial discussion | Discussion forum | Canadian High Interest Savings Bank Accounts

First post here but have been scouring the internet for anything related to what appears to be the collapse of Pace Securities. Nothing. My TFSA with them largely comprised of Pace Financial Ltd preferred stock has lost 40k, non pandemic related I guess. Got an official letter today...

www.highinterestsavings.ca

 

[nottyboi]

I had some money with DUCA and they tried to sell me some sort of share with a higher rate of return then the high interst account but I did not bite as there are better companies to buy stock in.

 

[Darts]

I read some articles about the Pace CU mess. Not sure I fully understand this web of events but definitely convoluted and left some investors (who were told they weren't investors) exposed.
Damn, G&M has a paywall.

Also, I stayed away from those high yield CU preferred shares because no one could explain how I will get my principal back.

 

[y2kmark]

This is a scary article about how a large number of Pace credit union members thought they were being sold member preference shares when the securities division deceived themand old them high risk investments in a junk bond fund.
Now the credit union is looking into a way to make their investors whole so they don’t get hit with a class action lawsuit.
I know some folks who work there and even employees bought in and are super angry.
Ernie Eves was a director of here too.
Here’s a link to the story on the Globe. Apparently there will be a lot more coverage coming soon.

PACE credit union launches investigation of improper investment sales by brokerage division

Investors claim high-risk preferred shares were promoted as a safe investment

www.theglobeandmail.com

Apparently Pace credit union was placed under administration and the whole board and ceo got fired and this shady sale was perpetuated by them. Hopefully the new board will fix the mess they inherited or else it could be very bad for the credit union.

Former MPP Frank Klees makes millions from PACE Credit Union - Gordon Prentice at Large - Politics in Newmarket

Frank Klees former MPP and his relationship with PACE credit union

www.shrinkslessorsquare.ca

I also noticed a very angry blog about this where even apparently even the credit union admits to deception.

Pace Securities | Page 19 | General financial discussion | Discussion forum | Canadian High Interest Savings Bank Accounts

First post here but have been scouring the internet for anything related to what appears to be the collapse of Pace Securities. Nothing. My TFSA with them largely comprised of Pace Financial Ltd preferred stock has lost 40k, non pandemic related I guess. Got an official letter today...

www.highinterestsavings.ca

Sounds just like the Franklin S&L scandal - minus the Keating Five...

 

[Darts]

Ontario actually guarantees up to $250,000 (unlimited for registered accounts) for GIC's issued by Ontario credit unions which is higher than the $100,000 offered by CDIC.

 

[ActionJ]

These types of investments are not covered by the cdic or dico.

 

[billie69]

There will probably be lawsuits after multiple regulators (IIROC, FSRA, OSC) investigate.

 

[billie69]

There’s been an update on this story from a couple of days ago.

The case is moving to “Mediation” as the Credit Union and regulator agree that the Credit Union acted inappropriately and the CEO and board of PACE credit union resigned!

Now, the regulator, FSRA, has resumed control of PACE credit union and appointed a new CEO that will work with the investors law firm and the regulator to settle things.

The credit union even wanted to sue the regulator but is holding off because both groups messed up badly.

Anyway, here’s a link to the article:

Agencies battle over who dropped the ball as PACE credit union back under regulator’s control

An escalating dispute with PACE’s new leaders over a potentially messy lawsuit seeking compensation for the investors’ losses, and a failed attempt to settle it quickly, opened a deep rift between the FSRA and the board of directors

www.theglobeandmail.com

 

[New World]

Wow.. If I was a customer of Pace CU I would be withdrawing all my assets immediately.

 

[billie69]

As someone trying to make a living and pay my mortgage on a house, I'm always afraid to buy stock on junk bonds.

The Credit Union made it seem like these new shares were just like the other equity shares many members bought before which were part of the capital structure backed by the credit unions huge loan and mortgage portfolio and did not disclose what the investment really was.

The credit union settled and investors got most of their money back and the regulator fined a few people.

 

[craig_hoxton]

...and people think credit unions are "the good guys".

 

[Darts]

PACE assets and deposits are being taken over by Alterna CU. Looks like what remains of PACE will be wound-up.