CSA study shows one in 20 Canadians a victim of investment fraud - often introduced by someone they know and trust

    MONTREAL, Oct. 2 /CNW/ - A new national study on investment fraud and its
social impact estimates that over one million adult Canadians have been the
victim of investment fraud and that half these victims were introduced to the
fraud through an existing relationship of trust, such as a friend, family
member or work colleague.
    The latest Canadian Securities Administrators (CSA) Investor Study:
Understanding the Social Impact of Investment Fraud finds that investment
fraud often results in a loss of trust between victims and those close to
them, as well as a loss of confidence in the system as a whole. In fact, 68%
of fraud victims report they are less likely to trust people in general and
63% report they are less willing to make future investments.
    "The first casualty of fraud is the victim's trust in other people,
investments and the financial markets," said CSA Chair Jean St-Gelais. "As
regulators, we are concerned when investors lack the trust to invest again in
our financial markets. We must continue to educate people on how to recognize,
avoid and report investment fraud."
    The study also finds that the impact of fraud - especially among those
who lost more than $10,000 - goes beyond trust. Victims of investment fraud
reported negative impacts to their health, as well as to their social
    The study finds several attitudes made investors vulnerable to investment
fraud. People who don't trust investment professionals, those who say you have
to bend the rules to get ahead and people who feel that every investment is a
gamble are two or three times more likely to be a victim of investment fraud
than the average Canadian.
    "We want people to understand that no one is immune to investment fraud.
The study shows it is a common occurrence in the lives of many Canadians, with
almost one-in-20 having been victimized. Everyone is vulnerable and all
investors can benefit by doing their homework. The securities regulators can
help with information and investor resources," said St-Gelais.
    The study also finds over 90% of Canadians believe the impact of
investment fraud is as serious as that of violent crimes, but most people
think the criminal justice system as a whole does not treat investment fraud
as seriously as other crimes. People do believe that reporting investment
fraud is worth the effort, yet few people actually report these crimes. Just
17% report their most recent experience with attempted fraud to authorities
(the RCMP, local police, legal community, investment industry, consumer
advocacy groups, and securities regulators). Of those who were victimized,
only 22% of one-time victims and 28% of repeat victims reported their most
recent fraud experience.
    The CSA website and provincial and territorial securities regulators
provide resources to help investors find the tools they need to spot and
report fraud. The study's executive summary is available online on the CSA
website www.csa-acvm.ca with the full study available upon request.

    The CSA commissioned Innovative Research Group Inc., a national public
opinion research firm, to conduct the 2007 CSA Investor Study: Understanding
the Social Impact of Investment Fraud, between July 16 and July 31, 2007.
Results from the survey are based on 5,868 completed online interviews of
Canadians, 18 years of age or older.

    The CSA, the council of securities regulators of Canada's provinces and
territories, coordinates and harmonizes regulation for the Canadian capital
markets. Their mandate is to protect investors from unfair or fraudulent
practices through regulation of the securities industry. Part of this
protection is educating investors about the risk, responsibilities and rewards
of investing.

For further information:

For further information: To arrange interviews with CSA Chair Jean
St-Gelais, please contact directly: Frédéric Alberro, Autorité des marchés
financiers, (514) 940-2176; For more information: Tamera Van Brunt, Alberta
Securities Commission, (403) 297-2664; Andrew Poon, British Columbia
Securities Commission, (604) 899-6880; Barbara Shourounis, Saskatchewan
Financial Services Commission, (306) 787-5842; Ainsley Cunningham, Manitoba
Securities Commission, (204) 945-4733; Laurie Gillett, Ontario Securities
Commission, (416) 595-8913; Frédéric Alberro, Autorité des marchés financiers,
(514) 940-2176; Jane Gillies, New Brunswick Securities Commission, (506)
643-7745; Chris Pottie, Nova Scotia Securities Commission, (902) 424-5393;
Marc Gallant, Prince Edward Island Office of the Attorney General, (902)
368-4552; Bette Boyd, Yukon Securities Registry, (867) 667-5225; Donald
MacDougall, Securities Registration of the Northwest Territories, (867)
920-8984; Doug Connolly, Financial Services Regulation Division, Newfoundland
and Labrador, (709) 729-2594

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890