Case Studies


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Elderly Investor Solely Relied on Advisor for Investment Advice

Posted on Friday, November 12, 2010 03:45 PM

In 2002, Mrs. E, then 71-years-old, began investing at Firm ABC with the help of an investment advisor. As her financial knowledge was limited, she let her advisor manage her registered account. The Know-Your-Client (KYC) form she signed indicated she was a conservative investor seeking to preserve her capital. Her initial portfolio was worth $71,000 and contained a mix of conservative investments such as corporate bonds as well as income and money market mutual funds.

Over the years Mrs. E was satisfied...

Experienced Investor Claimed Investments Were Not Disclosed Properly and Unsuitable

Posted on Friday, November 12, 2010 03:45 PM

On the suggestion of his advisor, Mr. V had purchased special “synthetic" preferred shares of a complex structured investment product offering a principal guarantee at maturity. Its returns depended on the number of future credit defaults, or in other words, the level of net losses within the underlying portfolio. Shortly after purchasing the shares, an unexpected rise in credit defaults seriously impaired the viability of the product. Shareholders voted for early redemption, even with the knowledge...

Nephew Argued Aunt's Bequeathment Should Have Been More

Posted on Friday, November 12, 2010 01:00 PM

Mr. S was his late aunt's primary caregiver. For three years, he took care of her by taking her to doctor's appointments, hiring additional support persons, consulting lawyers, making medical decisions and attending to other needs as they arose.

In accordance with his aunt's will, which was many years old, the bank was appointed sole liquidator of the estate upon her death. Mr. S argued the estate owed him $100,000 as compensation for his role as primary caregiver. In addition, he sought $15,000 for...

Life Insurance on Lines of Credit Denied

Posted on Friday, November 12, 2010 12:45 PM

Mrs. A's husband passed away in 2008 leaving her the sole beneficiary of his estate. After his passing, Mrs. A submitted life insurance claims for $88,000 covering the two lines of credit (LOC) that her late husband had taken out in 2000 at their bank.

The bank declined Mrs. A's claim. It based its decision on two documents called “waivers" that had apparently been signed by Mrs. A's husband back in 2000 through which he declined life insurance coverage on the LOCs. Despite these waivers, however,...

Unauthorized Purchases While Travelling

Posted on Friday, November 12, 2010 12:45 PM

Ms. H went on a trip overseas where she claimed she was the victim of a credit card fraud. Ms. H insisted that while she was travelling she never used her credit card or gave her PIN or card to anyone. Several overseas cash advances were recorded during her time abroad. She therefore asserted that she was a victim of fraud and requested that her bank compensate her for her loss of just over $3,000.

Ms. H's bank denied her claim. In its view, Ms. H had kept both her PIN and her card together, which...

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