Laurie in Question Period
Asset backed Commercial Paper
Ms Blakeman: Thank you, Mr. Speaker. The asset backed commercial paper crisis is about risk management and regulatory bodies providing consumer protection, but in real life terms this is about individuals’ life savings being put in peril because they trusted the provincial regulators to protect them, and they trusted their financial institutions to provide them with sound advice. My questions are to the minister of finance. Why was the Alberta Securities Commission not able to protect retail investors against the risks associated with these investments?
Ms Evans: Mr. Speaker, this asset backed paper has been very big for investors. There’s no question that for those investors that made that kind of investment, no doubt they felt it was rather a secure opportunity because, in fact, it had a triple A credit rating. We’ve seen Purdy Crawford on behalf of the group travel to talk to investors across the country. They have in fact struck an arrangement that seems to be to the satisfaction of most of the small investors, who will receive and recoup a hundred per cent of their investment. I think that currently we’re just waiting to find out whether or not any of the corporations that have challenged this particular arrangement go further, pursue further any legal action through the courts.
The Speaker: The hon. member.
Ms Blakeman: Thank you. To the same minister: why were the retail investors not provided with the proper information regarding the risk of these investments?
Ms Evans: Mr. Speaker, I can’t anticipate or reflect on what they were provided. I think it would be unique, depending upon the investor and where, in fact, they placed their investment dollars. It might have been through a banking institution or making some other particular arrangement, but to the best of my knowledge they were given the opportunity to scrutinize that themselves. When one invests their money, they have an obligation to do that due diligence themselves. No doubt those investment opportunities were made through the best information available.
The Speaker: The hon. member.
Ms Blakeman: Thank you. Again to the same minister: well, what mechanisms or changes have been made by this government under this minister to protect these investors in the future?
Ms Evans: Mr. Speaker, that’s a very good question. If you look to the future, if you look at what’s happening in America, the issues where the federal government has become involved to look at whether or not there should be more regulation, Canada for the most part during this period where America has been under some scrutiny because of a perceived recession has been much better positioned. Whether or not our federal government or securities commissions across the country look at a different set of regulatory framework or whether governments, in fact, anticipate, that will depend a great deal on how we resolve and continue to untangle this particular situation.
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