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By Al Emid

Bill Devolin, Director, Manulife Investments, and several colleagues advanced the campaign for simplified processing procedures at a meeting in February at FundSERV. This follows a detailed analysis of all of the steps in a segregated fund transaction undertaken last summer, and aims at targeting gaps and barriers to efficiency and possible solutions.

They presented their draft of the new IDA Member Annuity Sale and Servicing Agreement to representatives of several brokerage organizations including BMO Nesbitt Burns Inc., CIBC World Markets Inc., National Bank Financial Inc., RBC Dominion Securities Inc., Scotia Capital Inc., and TD Securities Inc.

The agreement contained changes aimed at improving the automated handling of nominee segregated fund transactions.

IDA member representatives wanted to reduce the paperwork that accompanies segregated fund transfers, Devolin explained.

The agreement affects three types of transfer situations:

• Registered external transfers between two IDA members.
  
  
• Non-registered external transfers between two IDA members.
  
  
• Non-registered to registered internal transfers within the same dealer.

"We were successful on how we can transact internal and external nominee transfers across IDA firms," he said.

One change involved supplementary paperwork for registered and non-registered accounts such as signatures in IDA to IDA external transfers and IDA internal transfers. The solution in the draft agreement is deceptively simple and designed to meet the requirements of regulators, IDA members and insurance companies, Devolin said. "We are going to take the dealers' authorization to move the account and consider that sufficient for our needs."

The draft agreement presented at the meeting also addressed recommendations for naming conventions for the beneficiary in nominee registered accounts.

"The additional challenge relates to the appropriate naming of the account beneficiary and we have a proposal on how to accomplish that," said Devolin who chairs the FundSERV/IDA segregated fund operations committee.

That proposal — also accepted at the meeting — called for defining the beneficiary as the dealer-in-trust for the beneficial owner.

Individual members at the February meeting have to review the proposed agreement with the companies' compliance and legal departments.

This agreement applies solely to segregated fund transactions between Manulife and the brokerage firms represented at the meeting but may serve as a model for other agreements in future.

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