In the next few weeks I’ll be running a interview with the CEO of the Mutual Funds Dealers Association (MFDA), Larry Waite. There are probably a lot of people who don’t even know what the MFDA is, or what functions they perform – but I’ll skip ahead and tell you that a lot of people assume they police mutual funds. They do not. They regulate the distribution side of the Canadian mutual fund industry. The MFDA was incepted in 1988 and some would consider the regulation of distribution back then to be something akin to Dodge City and the Wild West. There were some people who felt incredibly threatened by the MFDA. Larry has given me permission to post this letter from an angry industry participant (who shall remain anonymous) in its entirety.
September 5, 2000
121 King Street West, 16th Floor
Dear Hitler and the S.S.:
I am writing in regards to all your rules and regulations that your so called commission group is implementing without consulting anyone that they affect. As a citizen in a free country run by a democratic government, I am concerned with who is dictating these rules. You are sticking your big bank noses into places that I don’t think you are welcome.
Years ago when the big banks didn’t want to sell mutual funds, there weren’t any “rape and pillage the private person committees” telling us what we could and could not do with our money. If I find a person that I trust with my life affairs, I believe that is my business and not some bureaucratic jerk’s business.
I am also very upset that you are sticking your nose into other affairs that some investors do just for their clients. For example: Income Tax Returns. As a private citizen I can and should be able to let any capable person complete these forms for me. This is my right as a so-called free citizen. There is no law that I am aware of stating that I need to hire a Chartered Accountant to do my personal taxes. If I feel this person is able and willing to do my taxes or invest my money, I should and I will let them, providing they are helping me achieve my goals. This is also one way for our financial advisors to get to know their clients, which is something you want them to do. As people from the big banks, you do not get to know your clients personally, for you care about only one thing, profits for all the pigs at the trough.
(once a free man)
This person certainly had a flare for the dramatic. My understanding is that this was one of the more tame letters, too! I wasn’t in the industry back then, but I’ll offer my advice (you get what you pay for, remember!): if you want someone to take you seriously, I would reconsider addressing them as Hitler at any point in your correspondence.
Stay tuned for the interview which should run in the next two weeks. I asked a number of questions, including one about the possibility of MFDA advisors being allowed to sell ETFs – why can’t they, and what are the options for these investors?
Thanks to Larry Waite, CEO of the MFDA for his permission to post this letter.