This morning, a large group of ILAS victims met with 8 representatives from the Securities and Futures Commission. One by one, each victim told his or her story. Afterwards, Lindell Lucy (author of this blog) gave a PowerPoint presentation which made the case that sales of ILAS fell under SFC jurisdiction—contrary to SFC’s persistent denial. A copy of Lindell’s PowerPoint can be downloaded HERE.
When an SFC executive was pressed to answer whether selling an investment fund within a portfolio bond was an SFC-regulated activity, he answered, “It’s not the right time or place to make a determination on these types of things.”
He was correct. The right time to make a determination on these types of things was at least two decades ago.
Some of the victims at the meeting had been sold a scam investment fund wrapped in an ILAS portfolio bond. These victims previously filed complaints with the Office of the Commissioner of Insurance, but OCI rejected their complaints, arguing that sales of investment funds (even within portfolio bonds) fell outside of OCI’s jurisdiction. In a meeting held on Feb 9th, Insurance Commissioner Annie Choi said that this activity fell under SFC jurisdiction.
An SFC executive declined to comment on Annie Choi’s position.
However, he said that SFC continued to stand by its position as stated in THIS 2009 circular.
When it was pointed out that many of the assumptions and statements in that circular were false, SFC made no comment—just ‘listened’.