Toronto (August 10, 2001) – The Financial Services Commission of Ontario (FSCO) today issued a Notice of Proposal to revoke the registration of the Canadian Corporation Creation Center (CCCC) Pension Plan, and announced that the Deputy Superintendent, Pension Division, is acting as the administrator of the pension plan effective August 3, 2001. FSCO regulates pensions in Ontario.
Dave Gordon, Deputy Superintendent, Pension Division, indicates that these steps were taken because this pension plan does not have a properly constituted administrator, and that there were a number of recent activities of the plan that appear to contravene the legislative requirements of the Ontario Pension Benefits Act, R.S.O. 1990 (Act).
When the CCCC Pension Plan was established in November, 2000, it appeared to be a typical pension plan arrangement operating in compliance with the Act. However, subsequent inquiries indicated that the CCCC Pension Plan and NBI Trust, a related company, were participating in a scheme to systematically unlock monies locked-in under the Act. The scheme took advantage of people in financial difficulty by lending them their own money and taking a significant percentage of the locked-in account as a fee.
People who answered ads placed in local newspapers were told that they would receive a loan in return for a fee and a percentage of the value of their locked-in pension funds held in a Locked-in Retirement Account (LIRA), Life Income Fund (LIF) or Locked-in Retirement Income Fund (LRIF). The fees typically exceeded 30% of the assets of the locked-in amount. The individual was asked to sign papers transferring their locked-in accounts to the CCCC Pension Plan. In exchange the individual then received a portion of the value of their locked-in amount as a loan. The remaining amounts were paid to CCCC as their fee. The total monies from the locked-in account were subsequently paid out.
Deputy Superintendent Gordon advises that if someone is facing financial hardship and has a locked-in retirement account, FSCO has a branch that will provide information on how to unlock these funds if they fall within the grounds set out under the Pension Benefits Act.
Persons who have signed over their locked-in retirement accounts to the CCCC Pension Plan or NBI in Trust Inc., should contact the Pensions Plans Branch, Financial Services Commission of Ontario, 5160 Yonge Street, Toronto ON M2N 6L9, fax: 416-226-7777, or e-mail PPB@fsco.gov.on.ca.
Brian Donlevy, Information Officer (416) 590-7057