The Canadian Investor Protection Fund is dealing with its second firm failure in as many weeks.
The contingency fund has issued a notice to clients of First Leaside Securities Inc., which had its membership suspended by the Investment Industry Regulatory Organization of Canada on February 24. It notes that First Leaside has ceased business but that the fund does not have complete information as to its financial status.
The notice indicates that customers with accounts at First Leaside, who have suffered financial loss solely as a result of First Leaside becoming insolvent may be eligible for coverage by CIPF. Losses that do not result from the insolvency of the firm are not eligible for coverage.
Earlier this month, the fund issued a similar notice about Barret Capital Management Inc., which had its membership suspended by IIROC as part of a settlement.
In the case of First Leaside, CIPF notes that the firm has stopped dealing with the public, and “IIROC staff may undertake any action with First Leaside’s carrying broker, Penson Financial Services Canada Inc., to facilitate the orderly transfer of customer accounts.”
Claims for CIPF coverage must be submitted by August 22.