Bill Morneau’s father sold 200K shares in family co. days before tax changes

[Slava]

Originally Posted by OMG!WTF!

I think it's not unreasonable at all. All insiders of public companies have to make those decisions all the time. Actually they don't. More often than not they're made for them on the form of rules governing the conduct of sales and purchases around news releases. This happens to be an ex corporate release done by a corporate insider. It's a weird situation but given Morneau's super shady past I would easily conclude that he and Sr were talking.

Right, there are rules and insiders simply have no choice but to follow those rules, or face prosecution. I think that it will be incredibly difficult to prove that Morneau Sr. violated these protocols though. He had sold a significant block 6 months before, and sold these in two separate transactions while the price declined in a period where it was known that a tax increase was likely.

And when did he have this insider information? Was it before the first sale in November or the second one? Why didn't he sell more shares in November if that was known?

[llwhiteoutll]

Originally Posted by Northendzone

just for fun, I'd be interested to know how much tax sr. saved thanks to the timing of his sale. I am assuming that he is already a very rich man, and even if he saved $25,000 - it is a drop in the bucket.

Yet at the same time, Morneau and Trudeau are completely happy to go after regular Canadians over drops in the bucket.

If people are fine with a $25k drop in the bucket for Morneau, then they should be fine when a small business owner invested through their company and saved $10k in taxes. That $10k is a tiny drop in the bucket of tax revenues.

[Northendzone]

^ I was trying to get at if sr. saved himself $25k, it is likely a small amount based on his personal wealth - so if he made the trade based on insider knowledge, why do run the risk of negative publicity for your son just to save a relatively small amount of tax compared to your net worth.

I tried to look up sr's net worth; however, was unable to find it quickly.

yeah, I believe the government will put the screws to the average citizen for small amounts, but will seemingly strike deals with high net worth folks - but that is another conversation

[cal_guy]

Originally Posted by llwhiteoutll

Yet at the same time, Morneau and Trudeau are completely happy to go after regular Canadians over drops in the bucket.

If people are fine with a $25k drop in the bucket for Morneau, then they should be fine when a small business owner invested through their company and saved $10k in taxes. That $10k is a tiny drop in the bucket of tax revenues.

The new rules will exempt the first $50,000 of passive income from the changes.

[Dogbert]

It would be really nice if the Trudeau government would stop having a scandal a minute long enough not to hand the Tories, who are increasingly being dominated by the alt-right and religious wingnuts, a majority government in 2019.

[evman150]

Originally Posted by Dogbert

It would be really nice if the Trudeau government would stop having a scandal a minute long enough not to hand the Tories, who are increasingly being dominated by the alt-right and religious wingnuts, a majority government in 2019.

They'll be fine. This is typical mid-mandate riff-raff. Scheer is Harper without the cunning, and Singh is an inexperienced (though charismatic and appealing) politician leading a party that doesn't have a chance of forming government. And I say that as a sometimes NDP supporter.

[GGG]

Originally Posted by Northendzone

^ I was trying to get at if sr. saved himself $25k, it is likely a small amount based on his personal wealth - so if he made the trade based on insider knowledge, why do run the risk of negative publicity for your son just to save a relatively small amount of tax compared to your net worth.

I tried to look up sr's net worth; however, was unable to find it quickly.

yeah, I believe the government will put the screws to the average citizen for small amounts, but will seemingly strike deals with high net worth folks - but that is another conversation

It's not the tax savings as they were available before or after the announcement. It's selling the shares knowing the price of the shares were going to drop. It's effectively steeling money from the person who bought them if he had advanced info.

The total value was a 400k difference.

[Slava]

Originally Posted by GGG

It's not the tax savings as they were available before or after the announcement. It's selling the shares knowing the price of the shares were going to drop. It's effectively steeling money from the person who bought them if he had advanced info.

The total value was a 400k difference.

Ok, well again let me ask, do you think he knew before the November sale? You seem to be rolling that in to get to the $400k, so why wouldn't he sell more shares at that point?

[chemgear]

Originally Posted by Slava

Ok, well again let me ask, do you think he knew before the November sale? You seem to be rolling that in to get to the $400k, so why wouldn't he sell more shares at that point?

Are insider trading investigations/convictions predicated upon an all or nothing transaction, is it proof of innocence if you sell 999,999 shares of something versus 1,000,000 during actual court cases with the ASC or OSC?

[OMG!WTF!]

Originally Posted by Slava

Ok, well again let me ask, do you think he knew before the November sale? You seem to be rolling that in to get to the $400k, so why wouldn't he sell more shares at that point?

I think because there is a time value to money, especially when dividends are involved. It pays to hang on to shares as long as you can (especially a low volatility stock like Morneau) without causing a disruption in the market.

[Slava]

Originally Posted by chemgear

Are insider trading investigations/convictions predicated upon an all or nothing transaction, is it proof of innocence if you sell 999,999 shares of something versus 1,000,000 during actual court cases with the ASC or OSC?

Of course not, but I would think that you need to have some evidence that he received the information and when, and that needs to have predated the sale?

Originally Posted by OMG!WTF!

I think because there is a time value to money, especially when dividends are involved. It pays to hang on to shares as long as you can (especially a low volatility stock like Morneau) without causing a disruption in the market.

I agree, but these two sales straddle the ex-dividend date from what I can see. So if that was a factor and he had the information, you would have waited until the date passed and made the sale(s)?

[GGG]

Originally Posted by Slava

Ok, well again let me ask, do you think he knew before the November sale? You seem to be rolling that in to get to the $400k, so why wouldn't he sell more shares at that point?

I was just responding to the idea it was 25k and being taken from the government rather than a much larger amount

I think this is bad optics. The real problem that should have forced his resignation was being involved with policy that directly benefitted his financial position. He should have liquidated the Morneau-Shappel shares the day he became finance Minister and put it all in a blind trust.

Not only did he not sell his shares he did not put them in a blind trust and he made policy that could affect them which was against what the ethics commissioner said he should be doing.

So we are at the stage now that he is either an incompetent idiot or highly unethical. Therefore he should resign

[Slava]

Well the truth is he should have resigned when he brought in the tax changes (which were later scrapped). I talked to some other advisors and we all realised that one of the major ways to shelter yourself from these tax changes involved a program which Morneau Sheppel just so happens to be a huge player in. So while the government was closing this particular tax window, one major "solution" was offered through his company. They're not the only players in that realm, but are enormous. There is just no way he wouldn't have realised that, and I just think it's reprehensible.

That said though, I don't think that the father traded these shares illegally. I think he knew that the Liberals were raising taxes the same as everyone else at that point and that was enough for him to want to move out of the shares.

[Resolute 14]

Ethics commissioner looking into the matter: https://globalnews.ca/news/3893089/e...-stock-trades/

While this is not yet a formal investigation, this is now the third time already that Morneau's actions have caught the attention of the commissioner.

Sorry Justin. I don't know if this is a case of silver spoon types wanting to stick together, but you need to remove him from his post. The last thing the Liberals need is to have that "corrupt" label hung back over them.

[Northendzone]

Wild bill and the minister must be starting to become very familiar with each other.

[cal_guy]

Originally Posted by Slava

Well the truth is he should have resigned when he brought in the tax changes (which were later scrapped). I talked to some other advisors and we all realised that one of the major ways to shelter yourself from these tax changes involved a program which Morneau Sheppel just so happens to be a huge player in. So while the government was closing this particular tax window, one major "solution" was offered through his company. They're not the only players in that realm, but are enormous. There is just no way he wouldn't have realised that, and I just think it's reprehensible.

The changes have not been scrapped, but only changed so that the first $50000 of passive income is exempt from the new rules.

[Slava]

Originally Posted by cal_guy

The changes have not been scrapped, but only changed so that the first $50000 of passive income is exempt from the new rules.

I thought they scrapped some of the other proposals as well? Like the income sprinkling for example, I thought they were adjusting the test to make it more rigorous or something like that?

[NuclearFart]

Originally Posted by Slava

Well the truth is he should have resigned when he brought in the tax changes (which were later scrapped). I talked to some other advisors and we all realised that one of the major ways to shelter yourself from these tax changes involved a program which Morneau Sheppel just so happens to be a huge player in. So while the government was closing this particular tax window, one major "solution" was offered through his company. They're not the only players in that realm, but are enormous. There is just no way he wouldn't have realised that, and I just think it's reprehensible.

That said though, I don't think that the father traded these shares illegally. I think he knew that the Liberals were raising taxes the same as everyone else at that point and that was enough for him to want to move out of the shares.

Are you talking about their offering of Independent Pension Plans (IPP)? When the Liberals announced the upcoming PC tax changes, Morneau Sheppel started aggressively and directly advertising to physicians about their IPPs, including a campaign of flyers and lunchtime seminars put on by their advisers. Morneau effectively put all the prof corp testicles in a vice with one hand, while using the other hand to offer a "solution" provided by his company.

How this blatant conflict of interest didn't get more media attention is beyond me. You expect this kind of activity from Trump, but the Morneaus are just as corrupt.

[Erick Estrada]

Originally Posted by Resolute 14

Ethics commissioner looking into the matter: https://globalnews.ca/news/3893089/e...-stock-trades/

While this is not yet a formal investigation, this is now the third time already that Morneau's actions have caught the attention of the commissioner.

Sorry Justin. I don't know if this is a case of silver spoon types wanting to stick together, but you need to remove him from his post. The last thing the Liberals need is to have that "corrupt" label hung back over them.

Back? When did they ever escape that label?

[CaptainCrunch]

The Prime Minister is slowly being cornered into firing Morneau publicly I don't think he can wait for a normal cabinet shuffle.

With the fund raising business where they were basically selling influence. To Trudeau taking a vacation on a island owned by a powerful lobby head. To the whole flying people around on the jet while redacting the travel documents, to the moving expenses stuff by his own Chief of Staff. There is a pretty good stench of problems with integrity in this government. Morneau is a 10,000 pound gorilla in the room.

I don't know why the PM insists on keeping him, he's a pretty poor finance minister. But he has to know where the bodies are buried.

I would expect that any kind of firing will be nasty and Morneau is either going to get a huge severance or sue.