OTTAWA - The Canada Revenue Agency (CRA) is finding an increasing number of questionable Registered Retirement Savings Plan (RRSP) and Registered Retirement Income Fund (RRIF) tax-free withdrawal schemes. The CRA is warning that investing in such schemes could result in you losing your entire retirement savings to unscrupulous promoters and in a reassessment of your tax returns.

Stats and Facts

- To date, the CRA has reassessed over 3,100 taxpayers who participated in these schemes resulting in additional taxable income of approximately $144 million.

- Audits of another 1,800 taxpayers with $84 million in RRSP and RRIF investments are currently underway.

- Audits on other arrangements are about to begin.

Questionable RRSP/RRIF schemes

Taxpayers should avoid schemes that promise the following:

- Withdrawal of funds from an RRSP or RRIF without paying tax. Promoters often promise to return part of the taxpayer's investment by offshore debit or credit cards, offshore bank accounts, or loan-back arrangements;

- Immediate access to assets in "locked-in" RRSPs or RRIFs;

- Income tax deductions of three or more times the amount invested in an RRSP;

- Unrealistic returns on investments.

Typically, promoters of these questionable schemes direct the owner of a self directed RRSP or RRIF to purchase a particular investment through a specific trustee. The particular investment could be shares in a company, units of participation in a co-operative, a mortgage, or other types of investments.

Taxpayers should avoid these schemes for two reasons:

1. The full amount of any withdrawal or ineligible investment is included in the taxpayer's income in the year the investment was made or the withdrawal occurred. This means that taxes are assessed on these amounts, as well as any applicable interest. Penalties may also be levied for amounts not reported.

2. These arrangements can put their retirement savings at risk. In some cases, the promoter walks away with all the funds and cannot be found. Many Canadians have lost their entire retirement savings to unscrupulous promoters by participating in such arrangements.

These schemes are promoted to look legitimate.

The promotion of these schemes usually appears very professional and makes the schemes appear legitimate. Various promotional methods may be used, including the Internet, local newspaper advertisements, and promotional meetings.

Promoters often provide opinion letters from professionals that give the impression that the letter writer endorses the scheme. These letters should not be interpreted as providing any assurance that these schemes do what they claim to be doing or that the promised tax benefits are in accordance with the Income Tax Act.

Get professional, independent advice.

If you are thinking about investing in one of these arrangements, it's very important that you get independent legal and tax advice. Independent advice means advice from a tax professional who is not connected to the scheme or promoter.

HAMILTON, BERMUDA - Aurigen Re Capital Limited ("Aurigen") announces that it has completed its initial capitalization by securing $500 million of equity (all amounts in Canadian dollars). This capital will support the start up of Aurigen's life reinsurance business unit in Canada and is the largest private equity raise to enable a company to compete in Canadian financial services. Capital commitments have been made principally by private equity funds managed by EdgeStone Capital Partners Inc., Englefield Capital LLP, Pine Brook Road Partners LLC and Soros Strategic Partners LP.

Aurigen was formed to provide a new source of life reinsurance capacity to life insurers in response to a growing need for diversification of counterparty risk, additional capacity and access to customized solutions. Aurigen will provide traditional life and health reinsurance solutions through its wholly-owned operating subsidiaries, Aurigen Reinsurance Limited, and subject to regulatory approval, AurigenCanada Limited.

The President and CEO of Aurigen is Alan Ryder, FSA, FCIA, an experienced life reinsurance executive who most recently served as President of General Electric Company's Canadian life reinsurance business, Employers Reassurance Canada.

The senior management of Aurigen Canada is comprised of Mr. Ryder, Gregg Clifton, Chief Financial Officer, Stephen Cooley, Chief Reinsurance Operations Officer, and Yana Gagne, Chief Business Development Officer. Management has extensive experience in the life and health reinsurance market and prides itself on its commitment, drive, innovation and creativity.

"We have observed a real market need for additional capacity and expert solutions that has resulted from the significant consolidation of the life reinsurance industry. Aurigen is a direct response to that need, with an experienced and knowledgeable management team backed by a leading group of investors that have significant financial resources, global scope and a breadth of expertise within and outside of the reinsurance business." said Alan Ryder, President and CEO. "We are very excited about the opportunity to apply our experience in bringing a committed player to the market," added Yana Gagne, Chief Business Development Officer.

Aurigen Canada Limited is based in Toronto, Canada and has submitted an application to the Office of the Superintendent of Financial Institutions for Canadian regulatory approval to be continued as a licensed life and health reinsurance company in Canada.

Aurigen Reinsurance Limited, based in Hamilton, Bermuda, has been approved by the Bermuda Monetary Authority to transact long term insurance business, subject to the satisfaction of certain conditions prior to commencement of operations.

Scotia Capital Inc. ("Scotia Capital") acted as financial advisor to Aurigen and placement agent for the capital commitments. Scotia Capital is a leading Canadian corporate and investment bank to the financial services industry, with particular expertise in the insurance sector. In addition to the capital commitments, Scotia Capital also arranged the seed capital provided by Maple Financial which has remained invested in Aurigen. Maple Financial is a privately-held, financial institution based in Canada, with offices in North America and Europe.

EdgeStone Capital Partners Inc. ("EdgeStone") is one of Canada's leading private equity firms with in excess of $2.5 billion of funds committed to date from institutional and high net worth clients. EdgeStone provides capital, strategic direction and business and financial advice to help promising mid-market and early-stage companies achieve their full potential.

Englefield Capital LLP ("Englefield") is a London-based private equity firm with approximately EUR 1.8 billion of committed funds to date, making private equity investments in buyout and development capital. Englefield seeks to make investments in companies which it can hold for a number of years while the businesses grow and increase in value. This provides for a stable environment for growing companies, like Aurigen, to develop and plan for the long-term without being constantly pressured to manage earnings or demonstrate short-term performance.

VANCOUVER, BRITISH COLUMBIA - Canadians provided business with $19 billion in subsidies in 2004, the equivalent of $1,295 from each Canadian taxpayer, according to a new report released today by independent research organization The Fraser Institute.

The 2004 figure was almost double the $10.3 billion governments doled out in business subsidies in 1995. Taxpayer-funded subsidies to business totalled almost $144 billion between 1995 and 2004 (the most recent year for which data is available), the equivalent of $11,030 per tax payer (all figures adjusted for inflation to 2007 dollars).

"There is no concrete evidence showing that government subsidies to business provide any net benefit to Canada's economy. Instead, these subsidies merely encourage the transfer of wealth from one set of taxpayers to another, often from small businesses to large businesses, and from taxpayers in general to special interests," said Mark Milke, author of the report, Corporate Welfare: A $144 Billion Addiction.

"Canada's business community needs to dump corporate welfare in favour of corporate tax cuts."

Milke's report looks at the amount of money Canadian governments of all levels spent on corporate welfare over a 10-year period. It provides repayment records by year with respect to specific programs or agencies involved in corporate welfare. It notes the cash-in-hand position of companies or parent companies that have received corporate welfare as well as offering an opportunity cost calculation for such disbursements.

The complete study is available at www.fraserinstitute.org.

"Governments justify the subsidies by claiming they help start-up companies. But many of the companies receiving the largest subsidies are anything but start ups," Milke said.

The report lists the top 50 business subsidy recipients, which include the Ford Motor Company, Rolls-Royce, Noranda, IBM, General Dynamics, Pratt & Whitney, Lockheed Martin, and Raytheon.

Milke points out that one of the main problems with corporate welfare is the lost opportunity to use the money for other purposes such as tax relief.

"If the federal government ended corporate welfare in 2004, the government could have reduced the federal corporate income tax rate to 14.6 per cent from 21 per cent. In other words, eliminating federal corporate subsidies could have resulted in a 30.5 per cent reduction in the federal corporate income tax rate."

Milke finds that although there is virtually no economic evidence supporting the use of business subsidies, governments historically pursue corporate welfare policies because they want to be seen to be "doing something" for their constituents.

"By subsidizing or bailing out failing businesses, politicians can tell voters they are saving jobs, or they can appeal to voters with interests in specific industries," Milke said. "At the same time, civil servants rarely oppose corporate welfare policies, often because these policies provide them with additional status or budgets."

In the end, he makes four recommendations for dealing with corporate welfare:

1. Wind down and end business assistance programs.

2. Require companies to repay already allocated subsidies as per the terms of their contracts and agreements.

3. Continue to support international efforts to end subsidies, including bilateral and multilateral agreements, as well as efforts to strengthen existing country-to-country treaties and to initiate new ones.

4. Use the money that would have been spent on business subsidies for business tax reductions.

"With $144 billion spent between 1995 and 2004 and $19 billion allocated in 2004 alone, corporate welfare to business is hurting Canadian taxpayers. Governments need to end these hand outs," Milke said.

"This money could be put to much better use by providing Canadian taxpayers with broad-based tax relief. Not only will this put more money in Canadians' pockets, research shows it will be much more successful in stimulating investment and economic growth."

360° Financial is focused on providing clients with financial protection through all stages of life, financial independence during retirement, and tools to provide financial support for the next generation.

The shifting of staff roles from Insurance Agents to Financial Representatives extends from a dedication to offer the broadest range of services to clients.

“Our goal is to equip all of our reps with an unparalleled suite of products, ensure their proficiency, support their drive and growth while reinforcing their day to day level of success and personal satisfaction,” said Neale. “We believe the results will speak for themselves.”

Former Austin Global Founder, President & CEO Reynolds Austin will continue as a Senior Associate & Advisor with 360° as the company continues to the frontlines of the Canadian Financial Services Industry.

OTTAWA, QUEBEC - Numerous individuals are receiving emails that are falsely identified as coming from the Canada Revenue Agency (CRA) confirming the registration of a complaint case. This email is not from the CRA.

The web links within the fraudulent email contain harmful software. If you receive this email, you should delete it. The CRA has already notified the proper authorities of this illegal activity.

A copy of the fraudulent email, which identifies individuals by name, is included below to help you better identify the scam. The links within the email copy have been disabled.

This document is also available for download in .pdf format.

SAMPLE OF FRAUDULENT EMAIL

From: Canada Revenue Agency (mailto:taxfraudcaseID29395@cra-arc.gc.ca)

Sent: November 9, 2007 11:07 AM

To: John Smith

Subject: Tax Avoidance Scheme Complaint , John Smith (Case id: #65FA72!)

Dear Mr. John Smith ,

This is an automated email that confirms the registration of your complaint case number : #65FA72 filed by Canada Revenue Agency (CRA) on November 08/2007 concerning Online Identity Theft.

While Canada Revenue Agency does not resolve individual consumer problems, your complaint helps us investigate fraud, and can lead to law enforcement action.

You can download a copy of your complaint from (web link). Please print and keep this copy for your personal records.

We use secure socket layer (SSL) encryption to protect the transmission of the information you submit to us when you use our secure online forms. The information you provided to us is stored securely.

The form you used to register this complaint is designed to improve public access to the Canada Revenue Agency of Consumer Protection Consumer Response Center, and is voluntary. Through this form, consumers may electronically register a complaint with the Canada Revenue Agency. Under the Paperwork Reduction Act, as amended, an agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a currently valid OMB control number.

Our staff will keep you updated regarding the status of our investigation. To check the status of your complaint please access (web link). The information in this news release was obtained from the court records.

End Sample

This new partnership was announced at MEDA’s 2007 Business as a Calling Convention in Toronto early this month by Ed Epp, MEDA’s Vice President for Resource Development. “MEDA Trust makes microfinance more real to the average person,” says Epp, sharing his thoughts on the program. “It brings the dignity and work of entrepreneurs in other countries home to people in Canada.”

MEDA and MSCU are inviting the credit union’s 16,000 members to “give the poor some credit.” This program provides the working poor with many opportunities, including experiencing the dignity gained by being able to financially provide for themselves and their families. Nick Driedger, MSCU’s CEO, added that, “This partnership is a strong reflection of our commitment to leadership in providing capital for economic development. We do this well at the local level and MEDA is the right partner for MSCU to make a difference in the global community.”

How does this program work?

The website, http://www.medatrust.org/mscu, allows MSCU members to set up a virtual portfolio through which they can choose clients from a real microfinance institution to fund. Once a client has repaid their loan, the funds are returned to that portfolio and the donor is free to fund another loan. These revolving loans make it possible for that money to influence multiple entrepreneurs. Live portfolio reports give donors a list of current and past clients, the repayment progress, the value of loans made and the remaining balance.

New survey shows only one in five factor long term care into their retirement plans

WATERLOO, ON - A survey for Manulife Financial reveals that seven out of 10 Canadians said they would prefer to have an annual physical exam than spend an hour discussing their long term care needs. This reluctance in discussing their future long term care needs helps explain why only 21 per cent of Canadians have factored long term care costs into their retirement planning.

Dr. Rubin Becker, MD, FRCP(c), a recognized Canadian gerontologist, explains that avoiding long term care planning is common - particularly as people must account for the possibility that they or their partner could experience deteriorating physical or mental health as they age.

"It's rare to see people plan for their long term care needs. Many recognize they will require help, yet few can actually visualize it. And, many Canadians find care costs are much higher than ever imagined," explains Dr. Becker.

While Canadians prefer to side-step the long term care discussion, they are not without worries about their future care. Fifty-seven per cent are concerned that they or their partner may need to go into a care facility in the future and are worried about their ability to pay for it. Moreover, 51 per cent fear becoming a burden to their family.

"The reality is that we're living longer, having fewer children to depend on, and there is a strong likelihood of needing long term care someday, especially if we live to age 85. Planning for our long term care needs should help ease worries," continues Dr. Becker. "Appropriate planning increases our ability to secure care, allowing us to remain at home for as long as possible in old age and it provides for a better quality of life, if and when facility-based care is needed."

The lack of planning doesn't come from a lack of personal experience with long term care. The survey found that 38 per cent of respondents reported having already provided long term care assistance to a family member or friend, mostly in the form of hands-on care. The greatest personal sacrifice in offering this assistance was "time loss."

How Canadians fare in long term care planning --------------------------------------------- The Manulife Financial survey provided a number of insights about how prepared Canadians are and their knowledge about long term care planning.

<< ---------------------------------------------------------------------
Canadians who: Canadians Age 35 - 75

---------------------------------------------------------------------
Are likely to use savings or retirement income to pay for long term care (LTC), if needed 80%
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Are likely to rely on government programs for LTC 61%
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Are likely to use equity from the home to cover LTC costs 53%
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Believe employee group benefits plans usually cover LTC 51%
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Factored LTC costs into retirement planning 21%
--------------------------------------------------------------------- >>

Paul Smith, Vice President of Marketing and Product Development for Manulife Financial's Individual Insurance area, points out that many Canadians assume employee group benefits cover long term care costs, which is rarely the case. "It's really important that Canadians know exactly what their benefit plans and current insurance policies will cover when it comes to long term care costs and plan accordingly for future care."

Smith further explains that long term care costs can quickly deplete retirement assets, especially for couples. "The impact on retirement savings can be significant when you consider the costs of facility care for several years, with after-tax retirement savings. One elderly partner may require facility care, while the other remains at home, so selling the house to shore up long term care funds is not always the most viable option. If retirement savings become depleted due to facility care costs for one partner, the other partner can find themselves without money to support their own care needs."

The Knowledge Bureau is a national certified educational institute, which provides continuing professional development to practicing professionals in tax and financial services leading to certification and designation. It is the home of the Distinguished Financial Advisor (DFA) and Master Financial Advisor (MFA) designations.

The Knowledge Bureau specializes in providing busy practitioners with convenient multi-media self-study courses, in-company classroom training and thorough Knowledge Bureau Education Days (workshops and conferences). It also engages its instructors to speak and instruct for in-company programs developed by its private clients.

Its courseware has been vetted by Departments of Education across Canada and the Human Resources Department of Canada, leading to its certification as an educational institute and as such, its tuition fees qualify for the tuition fee credit. Where students study at least 12 hours per month with the Knowledge Bureau, a textbook and education credit is possible. In addition, its courses have been accredited by a number of accrediting bodies in the tax and financial services industries.

The Knowledge Bureau has served over 3,000 student registrations since its inception in 2003 and has issued over 1,450 certificates to graduates in that time.

In April 2007, Decima Research showed that:

- the economic growth experienced by Canada in recent decades has made
the baby boomer generation the most affluent generation in our
history, even after adjusting for inflation

- 32% of Canadians have already received an inheritance in an average
amount of $56,000, but inheritances in the future are expected to be
five times this amount, or $300,000

- 30% view taxes as the chief threat to their inheritance, but only 7%
have sought professional advice

- "The Knowledge Bureau and Standard Life have partnered on various
initiatives. It is important for Standard Life to count on
recognized experts to help us fulfill our commitment for providing
added value to our advisors. The goal of our Partnering Program is
to offer tools to advisors and assist them in catering to the
requirements of the growing retirement income market," says
Mick?Kelly, Vice-President Sales, Retail Markets of Standard Life.

As part of the exclusive partnership between Standard Life and the
Knowledge Bureau, Standard Life qualified advisors will benefit from
discounted pricing.

The 12-month, self-study program, available to all advisors in English
only, consists of six 30-hour courses, which include:

- Tax-efficient retirement income planning

- Financial literacy: The relationship between risk and return

- Portfolio construction and real wealth management

- Advising family businesses

- Owner-manager compensation planning

- Use of trusts in tax and estate planning

In addition to the RIS program, Standard Life's value-added tools for
advisors include:

- Pareto referral system announced recently

- Retirement Planning Toolkit software, which illustrates
intergenerational retirement solutions

- Market outlooks from Standard Life Investments Inc.

- Standard Life's proprietary programs: Business Consultancy(TM) and Business Markets

Congress Could Exacerbate Problem

Washington, D.C. — As Congress scrambles to “fix” the sub-prime crisis that’s plunged mortgage lenders into bankruptcy and homeowners into trouble, a new report by the Competitive Enterprise Institute explains why Americans are better off if Congress keeps its mitts off the problem.

The various proposals in Congress are “unlikely to provide relief to homeowners in trouble and may even make things worse,” explain CEI analysts Eli Lehrer and John Berlau in “A Non-Prescription for Confronting the Sub-Prime Crisis.”

“To date, the crisis has been relatively minor—a small decline in homeownership combined with a small uptick in foreclosures, with well-off investors absorbing the bulk of the damage,” say Lehrer and Berlau. “Doing too much could turn a minor crisis into a major one affecting ordinary Americans.”

The report comes in advance of a likely vote in the House of Representatives on the “Mortgage Reform and Anti-Predatory Lending Act of 2007” (H.R. 3915), which would mandate that lenders only offer loans that the government determines have the “best terms” and “net tangible benefits” for borrowers. Lehrer and Berlau blast the paternalism of the bill’s approach and point out it could worsen the housing crisis by making it harder to get home loans. “This and similar proposals would go beyond improved disclosure to essentially outlawing certain types of loans … limiting the choices of both lenders and borrowers,” the authors explain. “A mandated ‘cheaper’ loan that requires larger cash payments at one time may hinder borrowers’ abilities to achieve other financial goals, such as sending a child to college.”

Arguing against both overregulation and bailouts from agencies such as the Federal Housing Administration, the authors conclude that these interventions will worsen the market’s ability to correct the problem by re-pricing risk. “The failure of hedge funds and mortgage firms sends a clear signal indicating bad business practices,” the authors explain. But many of the proposed solutions would likely both “increase default rates” and “make it impossible for some people to afford homes.”

Read the report: A Non-Prescription for Confronting the Sub-Prime Crisis: Congress Should do Nothing

Guelph - As genetic testing becomes more common, concerns about insurance companies having access to people's test results has many Canadians wanting to keep genetic information private.

But a new study by a University of Guelph economist has found that banning insurance companies from having access to genetic information could lead to a 300-per-cent hike in premiums for those with a close family history of a genetic disease.

Prof. Michael Hoy, working with Julia Witt, of the Institute of Applied Economic and Social Research at the University of Melbourne, has developed a model to simulate how insurance markets would be affected if insurance companies didn't have access to a client's genetic information.

Published recently in The Journal of Risk and Insurance, the research simulates the market for 10-year-term life insurance plans of women aged 35 to 39 years based on the assumption that they have all had testing for the BRCA 1/2 genes linked to breast cancer.

Currently, Canada has no laws specifically restricting the use of genetic testing results. But the 2003 Public Opinion Research Into Genetic Privacy Issues found that a majority of Canadians reject the right of insurance companies to ask for genetic information even if the applicants have knowledge of a genetic condition.

Insurance companies argue that they should know the test results for genetic indicators of certain diseases and disorders so they can adjust premiums and benefits for high-risk clients accordingly.

"They've always used factors such as age, gender, family history and medical history in considering premiums and benefits, so they say the information revealed by genetic tests shouldn't be treated any differently," Hoy said.

If a ban were instituted, some consumers would have more information about their genetics than their insurance companies would. The result could be high-risk clients buying more life insurance and insurance companies increasing rates based on factors like family history, Hoy said.

As a result, anyone with a family history would pay a higher rate - as much as 300 per cent - regardless of whether they carry the gene because insurance companies would treat the entire group the same. The general population would see an increase of about 1.5 per cent, the model predicts.

Inflated insurance prices could also force some low-risk individuals to drop out of the insurance market all together, Hoy added.

"With fewer low-risk clients overall, insurance companies would have to raise prices even more to satisfy claims and stakeholders."

The debate on whether genetic information should be private is happening across the globe. In Europe some countries have issued an outright ban, and the United States is currently creating regulations to restrict insurance companies from accessing genetic test results to set premiums for health insurance, said Hoy.

Based on his research, he believes that, in the long run, a ban may not be the best solution and that policy-makers may need to strike a balance between access to genetic information and overall insurance rates.

He recommends a five-year moratorium on the use of genetic results by insurance companies to be followed by a review of the situation.

"That way, if high-risk individuals are disproportionately buying up insurance, then the terms can be reconsidered and alternative ways of helping those who are being unfairly penalized can be developed."