Tuesday, July 15, 1997

OTTAWA - Today, the Canadian Community Reinvestment Coalition (CCRC) commended Jim Peterson, the Secretary of State (International Financial Institutions), for acting on the conflict of interest situation which James Baillie, former Chair of the Task Force on the Future of the Canadian Financial Services Sector, was in concerning mergers in the sector.

"James Baillie was in a clear conflict of interest which he could not avoid because while he was the chair he worked with clients on operating issues which will be affected by the Task Force and, as a partner in his law firm, he will receive a share of the fees for the law firm's work on the mergers," said Duff Conacher, Chairperson of the CCRC, "There was also a lot of other evidence that, as chair of the Task Force, Mr. Baillie was not maintaining an appropriately neutral position on the issues the Task Force was addressing."

The CCRC also expressed concern about the overall makeup of the Task Force. "The majority of Task Force members and staff have experience or ties with one or more areas of the sector," said Conacher, "while small business and consumer interests are in the minority."

"Any new chair of the Task Force must be open-minded and focussed on developing recommendations which are in the public interest, not just the private interests of various players in the industry," said Conacher, "The new chair must send a clear message to all the members of the Task Force that they must develop a set of recommendations by consensus, based upon a meaningful public consultation process, and that no single, private interest will be allowed to triumph over the public interest."

"For the new chair, the government should look to people such as Martin Connell, head of Calmeadow," said Conacher, "people who have experience with finance issues but who also have been exposed to the problems and concerns of business borrowers and financial consumers."

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