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The chill effect

Re Keystone Suit a Righteous Fight Against Unfairness (Jan. 9).

Barrie McKenna's column on TransCanada's NAFTA lawsuit questions the Council of Canadians' opposition to provisions in trade agreements that let foreign corporations challenge government policy for lost profits. TransCanada's fight is a battle against an unjust U.S. government, he insists, where the real victims are investors stymied by arbitrary foreign governments.

But the track record of these provisions, known as investor-state dispute settlements (ISDS), shows otherwise. Canada is among the most sued developed countries, facing claims for billions of dollars by corporate behemoths. In every case, the policies challenged are those that protect the environment, labour laws or human rights.

Top Ontario bureaucrats have acknowledged that you don't have to be threatened by it before ISDS is a factor in the decision-making process. The chill effect has begun.

If TransCanada wins, the loser is our shared democracy and the right of governments to practise it.

Maude Barlow, national chairperson, Council of Canadians

Fintech, facile

Re Is Fintech a Danger to Big Banks? and Alternate Banks: Evolution, not Revolution (Jan. 2):

Recent mainstream interest in the emerging fintech sector and the associated alternative banks and payment systems demonstrates that they are no longer fringe or speculative. Once a general media presence is achieved, it follows that the concept and business model of these enterprises is well exercised, at least enough to mount businesses that will test the market for the model, and also the range of the demand for services.

It's an exciting movement. However, in carrying news of these trends, some media seem to be fooled by the proponents, or at least willfully blind.

Citing lack of regulatory burden as an advantage is facile. The regulations exist to protect our society and banking system. It is true that the associated processes and systems carry a cost; nonetheless, I would rather incur that cost than enable movement of proceeds of crime, terrorist financing and tax evasion. I suggest that the next time The Globe features a purveyor of alternative banking, they ask specifically what safeguards are in place to prohibit such outcomes.

Andrée Shore, Toronto

Beer-can investing

Rob Carrick's column Leave DSCs to the Dinosaurs (Jan. 9) resonates with my own experience with a large and well-known Canadian mutual fund company.

My trusted adviser actively promoted his company's deferred sales charge funds for my own portfolio. Although my investments would be locked in for a seven-year term with expensive penalties for early withdrawal, I was assured that the higher earnings from that class of funds made it a worthwhile concession.

As I dug further, I discovered the "higher returns" result from a reduced management expense ratio relative to the funds' identical no-load counterparts by a minuscule 0.05 to 0.09 per cent. The difference in earnings is easily beaten by the value of the empty beer cans I return to the recycling depot in a similar period.

DSCs are more than dinosaurs. They reflect a deceptive practice that is trickery for the unwary.

Bruce Gurney, North Vancouver

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