When we formed our Private Client division over two-and-a-half years ago, we wanted to do something unique in our ability to display trust. Our answer was to form an Independent Review Committee (IRC).
By way of background, all prospectus-based funds (mutual funds, closed-end funds, ETF's) all have to have an IRC of at least 3 members. The closed-end fund we manage in our Institutional division (AHY.un) for Scotiabank has an IRC. I meet with the IRC of that fund at least four times per year. The IRC is responsible for all compliance matters on that fund and, most-importantly, they need to ensure that the fund (and the Portfolio Manager managing the fund...High Rock) is managing the portfolio exactly within the confines of what the prospectus states. That is to say, we are not permitted to stray outside of the restrictions stated in the prospectus. So to ensure that, the IRC pours over the portfolio, checks all the numbers and grills me about certain positions, etc. It is a very important role they play to ensure compliance at all times.
But in our Private Client division, we do not manage "funds". We manage all of our private client assets in Separately Managed Accounts (SMA). That is to say, each client has it's own account(s) and, although we do trades in their accounts, they own the securities in their accounts at all times. Managing client money on an SMA basis has many benefits but most notably it is way cheaper for the client and they also have complete transparency of the securities in their account at all times.
Now because we do not manage funds in our Private Client division but rather on an SMA basis, we are not obligated by the Ontario Securities Commission to have an IRC. However, we wanted to go the extra mile and do something no one else in the country has done...we formed an IRC for our Private SMA Clients. (We believe we are the only Portfolio Management company in the country, managing money on an SMA basis, to have formed an IRC...unique indeed).
So without further ado, here is Jonathan Heymann from Wychcrest Compliance services, in his capacity as our IRC, to help explain in more detail what he does on a quarterly basis for the sole benefit of our Private Clients:
If ever a client, or a prospective client, would like to speak to Jonathan at Wychcrest Compliance Services and get more detail about his role as our IRC and what makes High Rock different than the Investment Advisor community, please contact us and we will put you in touch with Jonathan directly.