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Client Relationship Model


ScotiaMcLeod®, a division of Scotia Capital Inc.

In recent years, a number of countries, including England, Australia and the United States, have changed the regulatory framework that governs their financial institutions. Included have been changes to formalize client communications and create greater transparency in fees. In part, these changes were the outcome of the global financial crisis of 2008-2009 – and while institutions in Canada faired relatively well, we will be implementing similar reforms here at home. Some changes have already been made with the remainder being phased in over a three year period.

Building upon existing requirements that help to ensure fair and honest dealing with clients, the Investment Industry Regulatory Organization of Canada (IIROC) has introduced the Client Relationship Model (CRM). At its core are three key principles designed to enhance investor protection and strengthen the client-advisor relationship:

Transparency regarding the relationship between the client, service provider and firm (e.g. information on account types, services provided, transaction and account fees);

Transparency surrounding performance of the account;

Disclosure of any conflicts of interest.

Additional information on CRM, including its history, can be found on the IIROC website (, link on page bottom

What will this mean for you?

Because the fundamental principles of CRM are a core part of the way we have always tried to serve our valued clients, many of the changes may not be perceived. While in other cases the changes may be apparent, but will not fundamentally change the advisor and client relationship at ScotiaMcLeod. How this affects you will depend upon your specific situation, include your account types and the securities that you hold.

Significant changes have already occurred in the areas of understanding your risk profile and investment suitability. In some cases, paper work and documentation requirements have increased, but in general the challenges in implementing the new regulations are operational in nature that are borne by the institution.

Your advisor is the best point of contact to explain how CRM relates to you and your specific portfolios and accounts. As the components of CRM are implemented over the next three years, additional information will be provided in person and in writing.

We are proud of the depth of expertise and wealth management service we provide. Furthermore, we expect the core principles of CRM will be a benefit to investors and will enhance the ongoing relationship between clients, advisors and ScotiaMcLeod.

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