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by Mike Caswell

Canaccord Genuity Corp. has asked the Supreme Court of British Columbia to adjourn a case in which the firm is being sued for putting retirees into overly risky options. Canaccord says it has recently discovered that the remaining plaintiff, Marlin Investments Inc., is controlled by a man very knowledgeable about misselling securities, Kenneth Marlin. He was a part owner of the Principal Group, an Edmonton trust company that collapsed in 1987, owing investors millions.

Given that one of the claims in the lawsuit is that Marlin "relied heavily" on advice provided by Canaccord, the firm says it needs more time to obtain documents about Mr. Marlin's past. From what Canaccord has learned so far, Mr. Marlin headed Principal Group's sales force and he was responsible for convincing investors to buy mutual funds and other products. "No-one was more informed about the issues of mis-selling securities than Mr. Marlin," Canaccord says.

(Mr. Marlin was one of two owners of the Principal Group, which operated from the 1950s until the Alberta government shut it down in 1987. The collapse was a major political issue at the time, as the Principal Group owed 67,233 investors $468-million. A court-ordered investigation into the collapse found that Connie Osterman, then a minister under Don Getty, had disregarded warnings in 1984 that the Principal Group was likely insolvent. She was fired shortly after the report's release, and the government immediately offered an $85-million settlement to investors.

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