Wednesday, 6 June 2007

BMO Investorline Modifies Foreign Currency Notice

Back on May 27th I posted this complaint about BMO Investorline's lack of disclosure with regard to the foreign exchange rates used when one trades in foreign securities, like those on US markets, on top of the fact that BMOIL does not allow foreign currency to be held within registered accounts, so making unjustified profits for BMOIL in the obligatory two-way currency exchange. Curiously, upon login to my account this morning, I discover that a new notice has suddenly appeared on BMOIL's webpage (see graphic).

Probably this is a coincidence since it is highly unusual for a big organization to make any change in response to an individual's complaint (large organizations by their nature only respond to an appropriately large stimulus, like losing a major lawsuit, getting into major financial problems etc). This notice doesn't provide any better disclosure, it merely says BMOIL can set whatever foreign exchange rates it likes on transactions. That neatly covers their liability, of course, which is BMOIL's primary objective. But it doesn't help investors trade accurately by having exact rates at the time of transactions. Nor does it seem fair for BMOIL to set whatever rates it likes, particularly since BMOIL only sets the rates at the end of the day, long after the trade has been committed. That BMOIL is trading the foreign currency for its own profit makes this unfairness even worse.

Another curiousity is that the link to the full agreement takes one to a pdf document dated March 2007. If there is something "new" in the agreement, wouldn't a more accurate date be June 2007, or is it allowed to retroactively change agreements? Just asking....

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