The Canadian Investor Protection Fund (“CIPF”) is a protection fund that was set up by the investment industry to return, within defined limits, the assets that you hold in an account at a CIPF Member if the CIPF Member is not able to return them because it is insolvent. Investment dealers that are Members of the Investment Industry Regulatory Organization of Canada (”IIROC”) are also Members of CIPF. A customer with an account at a CIPF Member is eligible for CIPF coverage of up to $1 million per General and per Separate account. For a list of current CIPF Members, please see CIPF’s Member Directory at the following link: http://www.cipf.ca/Public/MemberDirectory/CurrentMembers.aspx.
CIPF covers customers of Members who have suffered or may suffer financial loss solely as a result of the insolvency of a Member. Such loss must be in respect of a claim for the failure of the Member to return or account for securities, cash balances, commodities, futures contracts, segregated insurance funds or other property, received, acquired or held by, or in the control of, the Member for the customer, including property unlawfully converted. Customer losses that are not eligible for payment by CIPF include losses which do not result from the insolvency of a Member, such as customers' losses that result from changing market values of securities, unsuitable investments, the default of an issuer of securities, fraud, misrepresentation or material non-disclosure. For more information, please refer to the CIPF Coverage Policy, which can be found at the following link: http://www.cipf.ca/Public/CIPFCoverage/CoveragePolicy.aspx. Please also see the December 17, 2014 decision of the CIPF Appeal Committee, which further explains the scope of CIPF coverage. It can be found on www.cipf.ca at a link within the following CIPF notice: “CIPF Issues Notice to Former Customers of First Leaside Securities Inc., December 24, 2014”.
Since CIPF’s inception in 1969 there have been only 20 Member insolvencies. CIPF has paid claims and related expenses of $40 million, net of recoveries, and no eligible customers have suffered a loss of property. For a list of CIPF Member insolvencies, please visit the following link: http://www.cipf.ca/Public/AboutUs/HistoryofCIPF/CIPFMemberInsolvencies.aspx.
Best regards,
Stephen Sforza Student-at-Law, Canadian Investor Protection Fund