Canadian Pacific hit with violation notice after derailment in Maine

Christopher Reynolds, The Canadian Press

State authorities in Maine have hit Canadian Pacific Kansas City Ltd. with a violation notice over fallout from its cleanup efforts after a freight train went off the tracks last month.

Officials sent a notice of violation to the railway after heavy construction equipment deployed to access the crash site caused a "significant amount of sediment" to enter local waters in violation of a pollution control law, according to Maine's Department of Environmental Protection.

"Culverts were crushed and dirt has been shifted in and around a number of streams as a result of heavy machinery using the forest management roads," the department said in a release Friday.

Melanie Loyzim, the department's commissioner, sent a second letter instructing CPKC to implement erosion control measures "immediately."

On April 15 a Canadian Pacific Kansas City train hit a track washout in a wooded area near Moosehead Lake in northwestern Maine, some 220 kilometres southeast of Quebec City, setting several cars ablaze.

CPKC said last month that locomotives and four derailed lumber cars went up in flames, with crews using booms — absorbent, tubelike barriers — to contain spilled diesel fuel.

Cars carrying drums of ethanol and another hazardous material also skidded off the rails but did not catch fire, CPKC said. State officials said there is no threat to public safety.

Three crew members were taken to a local hospital for non-life-threatening injuries and released the same day, the railway said.

As of Friday, CPKC had about 60 emergency spill responders and environmental professionals on site to clean it up and monitor soil and surface water quality, the state officials said. Specialized railway equipment arrived Thursday, set to be lined with plastic and loaded with oil-saturated materials from the site.

"The remote, forested nature of the area combined with the spring thaw has made cleanup efforts challenging, including for the ingress and egress of people and equipment," Canadian Pacific spokesman Patrick Waldron said in an emailed statement Tuesday.

"CPKC is committed to the restoration of the derailment area and full cleanup of the affected environment. CPKC crews are on the ground working in full co-operation with the Maine Department of Environmental Protection, and other agencies, as we have since the derailment occurred."

The rail line is the same one where the fatal Lac-Mégantic disaster unfolded about 90 kilometres further west in 2013. Canadian Pacific did not own the track at the time.

The line — in CP Rail's hands until the mid-1990s, and later dubbed the Central Maine & Quebec Railway — was in dire need of an upgrade when the company repurchased it from private equity firm Fortress Investment Group in 2020.

"CP plans to invest as much as $90 million over the next three years to bring CMQ's rail infrastructure up to Federal Railroad Administration Class 3 standards," Canadian Pacific said nearly three years ago.

Greg Gormick, who heads On Track Consulting, said the accident could have been "much worse" given the route's rugged topography.

Last week, Canadian Pacific told Maine's environmental protection department its response team had recovered nearly 33,000 absorbent pads, 15,000-plus feet of absorbent boom and 12 cubic metres of fluid — oil, water and diesel — using vacuum trucks.

This report by The Canadian Press was first published May 2, 2023.

Cirque du Soleil president says AI in entertainment world a low risk to company

Stéphane Rolland, The Canadian Press

The head of Cirque du Soleil says artificial intelligence poses a low risk to the renowned Quebec company, even as debate is emerging about intellectual property protection for artists.

"We don't have all the answers yet, but I would be lying if I said I'm very worried, given the strength of the brand," president Stéphane Lefebvre said in an interview Tuesday.

"There are a lot of people in the past who wanted to do things that looked like Cirque du Soleil, even without artificial intelligence," he said. "There may be a lot of people who want to create similar circus shows, but without having the Cirque brand, the Cirque's seal of quality, it would become more complicated for people."

Artificial intelligence has raised hackles throughout the art and entertainment world, with AI platform users now able to create images, text and music inspired by — and sometimes nearly indistinguishable from — the pros.

Recently, a fake duet imitating the voices of Drake and The Weeknd went viral on social media, causing a stir in the recording community.

On the sidelines of a speech delivered to the Canadian Club in Montreal, Lefebvre acknowledged he's enjoyed experimenting with AI chatbots to tell a story or two to his kids.

He also said Cirque du Soleil would not completely close the door on the technology, but that he views it more as an administrative aid than an artistic one, pointing to potential legal pitfalls.

“We're trying try to see how we can use artificial intelligence to help us outside of the creative sphere,” he said.

In his speech, Lefebvre discussed Cirque du Soleil's recovery and current strategy. The 39-year-old circus troupe scrapped performances around the globe and cut nearly 3,500 employees after the COVID-19 pandemic struck, but began to add shows again in the summer of 2021.

The Montreal-based company aims to see its brand on other platforms beyond live entertainment, including video distribution and video games, he said, teasing an announcement in the latter industry for later this month.

MGM Studios has produced a documentary about Cirque du Soleil's return to the stage. Other video projects are in the pipeline, Lefebvre said, but he declined to offer specifics.

After the pandemic-induced shutdown, Cirque exceeded “all our expectations," Lefebvre said in his address, which was capped by a short acrobatic performance by Cirque artists.

In late 2020, Cirque was sold to a group of its creditors led by Catalyst Capital Group after the Montreal-based outfit was forced to file for creditor protection, having racked up a debt of US$1 billion.

The company now finds itself on more stable financial footing. In March, it managed to reduce its debt by US$100 million and to refinance it at lower rates, despite monetary tightening by central banks. Cirque du Soleil's total debt stood at US$550 million as of last month.

Lefebvre said demand remains strong for Cirque shows, despite the ongoing economic uncertainty. He attributed the interest to an entrenched desire for spectacle in the flesh, rather than to a post-confinement pendulum swing.

“People want to live experiences, to live them and to show everyone that they have had this experience. I think it's a strong trend and we're not going to go back."

HSBC expects later close of Canadian division sale to RBC

The Canadian Press

HSBC Holdings plc says the sale of its Canadian division to Royal Bank of Canada is going to take longer than first expected, but that the deal remains a key priority.

London-based HSBC says it now expects to complete the $13.5-billion transaction in the first quarter of 2024, rather than late this year as it guided when it announced the deal last November. 

The bank says the later close is to ensure a smooth transition, while several other recent bank deals have taken longer than expected amid heightened regulatory scrutiny including TD's still pending takeover of First Horizon. 

The Competition Bureau on Tuesday put out a call for input from the public on the RBC deal, seeking information that would help it assess potential impacts on competition from the deal.

Both the Competition Bureau and the Office of the Superintendent of Financial Institutions are reviewing the transaction, which requires approval from the finance minister.

HSBC Bank Canada says it had a record profit of $309 million before income tax expense in the first quarter, up $17 million from the same quarter last year, while its total assets were $123.3 billion at quarter end.

This report by The Canadian Press was first published May 2, 2023.

Competition Bureau seeks input on RBC's

proposed takeover of HSBC Bank Canada

The Canadian Press

The Competition Bureau has put out a call for information to help it review Royal Bank of Canada's proposed takeover of HSBC Bank Canada.

The agency says it's looking for input from market participants and Canadians on a range of areas including residential mortgages, personal and business lending and bank accounts.

It says the type of information it's interested to hear about include what kind of rivalry there is between RBC and HSBC as well as with other banks, what kind of effect the deal might have on price, quality or choice, and how easy it is to switch between banks.

The Competition Bureau says it is investigating whether the proposed deal is likely to result in a substantial lessening or prevention of competition.

RBC emerged in late November last year as the winning bidder for HSBC's Canadian division with a $13.5 billion deal.

Both the Competition Bureau and the Office of the Superintendent of Financial Institutions are reviewing the transaction, which requires approval from the Minister of Finance.

Not every airline can succeed in Canada's crowded market: Flair CEO

Amanda Stephenson, The Canadian Press

Not all of the Canadian airlines currently jockeying for position in a crowded market are likely to survive in the long-term, said the CEO of Edmonton-based Flair Airlines on Tuesday.

Stephen Jones made the comments at the Calgary International Airport on Tuesday, where discount carrier Flair is establishing a new base of operations as part of its ongoing aggressive expansion plans. The company, which had just three aircraft at the start of 2021, will have a total fleet of 21 Boeing 737s by this summer with service to over 30 cities across Canada, the U.S. and Mexico.

“I think there will be churn. I don’t think every airline is going to succeed and grow," said Jones in an interview.

"The trick I think will be picking a lane. Air Canada’s clearly got the top of it (the market), we’re clearly going for the bottom. I think the harder questions are for the airlines in the middle.”

The last few years have seen a surge of new Canadian airlines, including Edmonton-based Flair, Lynx and Canada Jetlines, while established carriers such as Porter Airlines are expanding aggressively.

Most of the new airlines are gunning to dominate the low-cost carrier model, which offers cheap base fares and then requires passengers to pay extra for add-ons such as checked bags, cancellations and changes, and seat selection.

Jones said in other parts of the world, the low-cost carrier model dominates the leisure travel market, and he said he expects in time that will be the case in Canada.

"I think there will be a significant low-class carrier dominating leisure travel 10 years from now. Our plan is for that to be Flair Airlines, but others have seen the same opportunity and they compete with us," he said.

One of those airlines "in the middle," which Jones suggested could be challenged to find its niche in future, is Canada's No. 2 airline, WestJet. 

By expanding in Calgary, Flair — which says it will employ nearly 150 people out of its Calgary base and offer 15 routes out of the city by this fall — is taking on WestJet in its own backyard. In fact, earlier this year WestJet announced a new strategic plan which will see the airline refocus on Western Canada, adding routes to and from Calgary and other Western cities and making Calgary the central hub for international flights using its wide-body 787 Dreamliner fleet.

When asked if Flair is trying to capture the market space that WestJet occupied in its early days, Jones said WestJet is in "transition." When WestJet launched in 1996, it aimed to emulate the successful low-cost model of Southwest Airlines, but the Calgary-based company has grown and expanded significantly since then — adding aircraft types, long-haul flying and different fare categories.

“I guess what I would say is they had a much more clear proposition back then than they have now," Jones said.

"Whereas we're much clearer on who we are and why we're here. We're not interested in inter-line, we're not interested in flights to Europe, or cargo ... That clarity makes things easier."

Jones also cast doubt on WestJet Airlines' purchase of Sunwing's main airline and vacation divisions, which became official Monday.

“Acquisitions and mergers in the airline industry are notoriously hard to implement," he said.

"I think it will be a little bit hard (for WestJet) to digest, as you’ve got different cultures, different pilot unions, and they’re notoriously hard to merge smoothly.”

In an emailed statement Tuesday, WestJet spokeswoman Madison Kruger said the airline believes in the value of competition, as "airlines with a strong foundation and business model" are essential to ensuring the longevity of the Canadian travel industry.

"We are confident in our new strategic direction that is rooted in providing friendly, reliable and affordable air travel to Canadians," Kruger wrote.

Jones' comments come as airlines and the travelling public are gearing up for the summer season, which is expected to be a busy one. He said Flair's summer bookings are up 30 per cent year-over-year, and already in the month of April the airline was flying planes that were 90 per cent full.

This is occurring at the same time that the Canadian Transportation Agency is dealing with a backlog of complaints from passengers who suffered flight disruptions, cancellations and general airport chaos last summer, as the Canadian aviation industry struggled to ramp up in the face of surging demand following the lifting of COVID-19 public health restrictions.

Flair was also forced to cancel multiple flights earlier this spring when four of its aircraft were seized by lessor Airborne Capital, which alleged that Flair fell behind in its payments.

Jones acknowledged that what happened last summer was a "meltdown" for the entire aviation system, from airlines to airports to border services agencies. He said that Canadians planning summer travel this year should rest assured that their experience in 2023 will be better.

"I look at our own performance just now, our on-time performance — it’s markedly better than it was last year. And I think the government services are all staffed up as well," he said.

"This summer, I’m sure there will be some disruptions, but it’s going to be completely different than last year.”

CRIMINAL CRYPTO CAPITALI$M

Securities Commission alleges fraud committed by B.C. crypto firm

Darryl Greer, The Canadian Press

The B.C. Securities Commission alleges a now-defunct cryptocurrency platform based in Nanaimo on Vancouver Island committed a multimillion-dollar securities fraud by diverting customer assets to online cryptocurrency gambling sites. 

In a notice of hearing issued last month, the commission says David Smillie and his numbered company, which did business as ezBtc, lied to customers about its crypto asset trading platform. 

The commission alleges Smillie and the company diverted about $13 million worth of bitcoin and ether, another cryptocurrency, to two online gambling sites without authorization from customers. 

The regulator says the company was dissolved in October 2022, but between 2016 and 2019 customers transferred 2,300 bitcoin and 600 ether tokens into wallets hosted by the platform. 

Smillie and the firm allegedly told customers their digital assets were mostly held off-line in so-called "cold storage," but they never truly maintained enough to cover users' assets.

Smillie and ezBtc were never registered under B.C.'s Securities Act, and the commission claims agreements with customers amounted to futures contracts, which fall under the commission's jurisdiction. 

Online court records searches show the company and Smillie face a number of lawsuits in British Columbia dating back several years, and the B.C. Securities Commission's director of enforcement Doug Muir said the hearing notice comes after a lengthy probe into the firm. 

"In this case, like in all of our cases, we need time to investigate, so we need to be able to gather evidence that we are satisfied," Muir said Tuesday. "So, that takes time to gather. Our investigations are often time consuming and complex and this one is an example of that."

Muir said the matter is administrative rather than criminal in nature, meaning the firm and Smillie won't face jail time, but may face monetary penalties or even banishment from public markets should the commission succeed in proving its case. 

Const. Gary O'Brien with the Nanaimo RCMP said the detachment's investigation into the company in 2019 didn't find enough evidence to lay criminal charges. 

"All I can say is that the matter was investigated and there was insufficient evidence gathered by the primary investigator to pursue criminal matters, so they decided it would probably be best to go from a civil angle," O'Brien said Tuesday. "That's the only information that I could provide at this point."

O'Brien said the file could be reopened should any victims or the securities commission reach out to investigators with new information. 

Sergei Goshko, an Ontario-based software engineer, said he used the ezBtc platform for cryptocurrency trading until it stopped allowing him access to his funds before its website "disappeared completely."

Goshko filed a lawsuit in B.C. Supreme Court in 2021 through a numbered company, and he said he was out between $70,000 and $80,000. 

His lawyers, though, weren't able to find Smillie and he was unaware the B.C. Securities Commission was taking action against ezBtc and its founder. 

"I guess it's a good thing, so maybe there'll be some progress," Goshko said Tuesday. "Maybe they will finally find him."

Smillie could not be reached for comment. 

The commission says Smillie and his company must attend its offices in downtown Vancouver on June 27 to fix a date for a hearing into the regulator's allegations. 

This report by The Canadian Press was first published May 2, 2023. 

Canadian Twitter users on why they decided to pay for their blue check mark

Tara Deschamps, The Canadian Press

Losing the app store is the last thing Twitter can afford

When Elon Musk took over Twitter last November, he quickly turned his attention to the platform's highly sought-after status symbol: the blue verification check mark.

The seal of approval previously handed out to celebrities, politicians, journalists and other public figures was meant to reduce impersonation attempts, help users wade through high volumes of replies and likes and make it easier to ensure people aren't duped by parody accounts.But Musk was intent on "treating everyone equally" and boosting the revenue of the US$44 billion social media platform he had just bought, so he announced last fall he would remove the check marks for users not paying for Twitter Blue. The platform's premium subscription also offers an edit button, fewer ads and the ability to post longer videos.

Accounts impersonating Tesla, gaming giant Nintendo and pharmaceutical company Eli Lilly sprang up and paid for verification, pushing Musk to dump his check mark removal plans, but he revived them in April, yanking the symbol from accounts.

Some users were so angered they fled the platform, while others stuck around but lamented that the verification change along with several other moves Musk made that have shifted Twitter's public image. 

And then there were the people who decided to pay. The Canadian Press asked several what made them open up their wallets.

GUY FELICELLA

Felicella, a Vancouver-based harm reduction and recovery advocate with 15,300 followers, wasn't drawn to subscribing to Twitter Blue because of the tick he'd see beside his username.

"That blue check mark, they could take it away today. I couldn't care less," he said.

"It doesn't matter to me."

Instead, it was text-based two-factor authentication and the ability to publish longer tweets that drew him in to forking over $155 a year (users don't need to pay for Blue to use an authenticator app). Felicella figured longer tweets mean more space for context and maybe, additional chances to connect with someone in need of his support.

Though some have left Twitter, he's sticking with the platform because he wants to help counter misinformation, especially about drug use, that he's seen spreading online.

"You've got to balance (the misinformation) out. I don't want them to take over," he said.

"I keep saying I'd rather hang out here and ruffle some feathers than just walk away from it."

JENNIFER SHAIGEC

The Calgary-based independent director at Teako Minerals Corp. and commodity specialist for CommonStock Inc. considers herself a "Twitter addict," using the platform daily and crediting it for helping her cope with the COVID-19 pandemic. 

"There was always someone to talk to about a common interest," she said via a Twitter direct message.

Shaigec subscribed to Blue for the features, which have reduced her ads by 50 per cent, let her tweet more than 280 characters, given her an edit button and helped her sort bookmarked posts by topic. 

"With the volume of tweets that I send out and the number I read daily, the Twitter Blue features seem to improve my efficiency on the app," she said.

But she added they're "more of a luxury" than a necessity.

"So I can understand why some are expressing dismay that the blue check mark is geared toward the elite – or those that can more easily afford the subscription price."

HEATHER STEFANSON

Manitoba's premier still has her blue check mark — a decision her communications team made to "protect the integrity of the account," a spokesperson said in an email.

"The subscription is covered by the PC Party of Manitoba — not taxpayers," the spokesperson added. 

DANIEL FOCH

The Keswick, Ont. real estate agent with 26,700 followers decided to shell out for a monthly subscription in March, after Twitter stopped text message-based two-factor authentication for users not paying for Blue.

By then, he had grown fed up with fake accounts impersonating people and peddling cryptocurrency scams and hoped Blue might cut down on such instances. 

"I'd get messages from people all the time telling me that there's this fake account. It's actually crazy how many times I'd get those messages," he said.

"If it eliminates that, that's worth it to me."

He still spots impersonators but feels the check mark gives his profile an added layer of authenticity and is part of a growing move toward paying for verification on other platforms. 

Meta announced in February that it will charge Facebook and Instagram users to have verified accounts.

SIMU LIU

The "Kim's Convenience" and "Shang-Chi and the Legend of the Ten Rings" star shared in mid-April that a misunderstanding about changes to two-factor authentication led him to open his wallet.

"I'm still blue because I thought I had to pay to retain two-factor authentication. They got me," he wrote in a tweet he ended with a sad face.

OLUMUYIWA IGBALAJOBI

The Calgary-based founder of Scholarships Cafe, a platform connecting people with scholarships and other academic opportunities, tried to get verified by Twitter about five times over the last few years to help his work reach more people.

He submitted newspaper articles he appeared in and information about his work in academia, but still couldn't convince Twitter to give him the mark until Musk opened up verification to users paying $11 in November.

"When I saw the opportunity to get a tick, I felt like it was time," Igbalajobi said.

He doesn't think Twitter Blue has given his tweets more exposure or sent any more opportunities his way than having a non-verified account would, but likes that it allows him to send longer tweets.

"A couple of days ago I made a list of the top 25 scholarships in Canada and I didn't have to split those tweets," he said.

"I could do that within two minutes."

This report by The Canadian Press was first published May 3, 2023.

Canadians targeted 'more aggressively' by fraud calls than Americans, study suggests

Sammy Hudes, The Canadian Press

A new study suggests there's been an uptick in phone scams in Canada, such as those involving federal agency impersonation or air duct cleaning.

A report released Tuesday by Seattle-based Hiya, which aims to protect phone users from spam through its voice security platform, found 6.3 per cent of unwanted calls received by Canadians in the first three months of the year were considered fraud, compared with 5.9 per cent in the final quarter of 2022.

Unwanted calls include those that are legal, such as sales calls concerning a service the recipient has subscribed to, as well as two illegal types: scams involving an outright lie, and those where a product does exist, but the recipient didn't request it.

Canada lags behind the United States, the study found: the average Canadian received three spam calls per month in the early part of the year, compared with 14.5 in the United States. 

But Canadians were on the other end of a much higher proportion of fraud-related calls. Spam calls made up 18.3 per cent of calls from unrecognized numbers in Canada, the report found, with 6.3 per cent of them considered fraud. In the U.S., one-quarter of calls from non-contacts in the first quarter were spam, but fraud calls accounted for just 0.7 per cent of them.

"It seems like for those who are trying to hit the Canadian market, they're doing so more aggressively," said Jonathan Nelson, director of product management for Hiya.

"You're getting a lot less of the high-volume businesses that are trying to operate within the laws, within the CRTC guidelines, and you're getting a lot more of those who are just ignoring the laws completely."

Like other countries studied, some of the top scams in Canada were related to cryptocurrency trading and those targeting newer immigrants who may be less familiar with the way the government works. The latter included callers impersonating government officials claiming to be from the Canada Border Services Agency or Canada Revenue Agency. 

On its website, the CRA reminds Canadians to be cautious when receiving calls that request personal information such as a social insurance number, credit card number, bank account number or passport number. While the CRA may call using an automated telephone message during tax season, it said it would never ask recipients to give any personal information.

Canadians also received high volumes of air duct cleaning scam calls, which the report noted were nothing new, but are largely unheard of outside of the country. 

"That's not even a concept we see in other markets," said Nelson.

"At some point, someone tried this campaign … and they must have had enough success that it just exploded. They just kept going and other spammers started copying them and it's just sort of stuck."

In 2022, the Canadian Anti-Fraud Centre received 90,377 fraud reports totalling more than $530 million in losses, according to data published in February. It estimated that just five to 10 per cent of victims file a fraud report with the CAFC.

It said identity fraud, phishing and extortion were the leading types of fraud reported.

The CAFC said on its website as of March 31, it had received 18,645 reports of fraud totalling $133.7 million in losses this year.

Combating scams has been a priority for Canada's telecommunications regulator in recent years.

Last November, the CRTC hosted a meeting with its counterparts from Australia, Ireland, Hong Kong and the U.S. to explore collaboration to disrupt scam communications.

A year earlier, the federal regulator mandated that telecom companies implement technology to validate a caller's identity. One component of that called Secure Telephony Information Revisited, or STIR, acts as a technical standard that provides a means for carriers to authenticate the identity of callers.

The other component, known as Shaken, short for "signature-based handling of asserted information using tokens," created the framework for implementing the standard in IP-based service providers' networks.

The CRTC did not respond to a request for comment.

Rogers Communications Inc. and Telus Communications Inc. have each rolled out additional tools to help filter out spam calls, while Bell Canada got the green light from the CRTC in 2021 to block all fraudulent calls transmitted over its network entirely.

"You are going to see a downturn with that, hopefully a lasting one," said Nelson.

"It all just goes back to the dollar signs. These campaigns do cost them money to run. They're looking at their success rates for these calls. If it declines, they'll either try different calls or try different markets."

Nelson said Hiya recommends having some level of spam protection on your phone so that when the phone rings, recipients have something more than a 10-digit number to go on to decide, "should I be wary."

"You just need to slip up once and it can really cost you," said Nelson. "Even if you think I could spot a scam from a mile away, they can be really clever, so always just be really cautious if you don't know who you're talking to."

This report by The Canadian Press was first published May 2, 2023.

 

Weight-loss brand Jenny Craig to close down operations

Hadriana Lowenkron and Emma Court, Bloomberg News

MIAMI, FLORIDA - APRIL 28: A person walks past a Jenny Craig weight loss store on April 28, 2023 in Miami, Florida. Reports indicate that the Jenny Craig company will undergo potential mass layoffs as it begins a hunt for a buyer. (Photo by Joe Raedle/Getty Images) , Photographer: Joe Raedle/Getty Images

Jenny Craig, the weight loss and nutrition business backed by HIG Capital, will shut down after four decades of operation after failing to secure additional financing, according to an employee. 

Management informed workers of the news in an email late Tuesday, and company-owned centers where members pick up meals, consult with coaches and weigh in are closed as of Wednesday, the employee said, adding that franchise-owned locations may remain open. 

Jenny Craig had been seeking a buyer as it struggles amid increased competition, including against much-hyped new weight loss drugs. With about 500 North American locations and around 600 centres worldwide, Jenny Craig was also hurt by the COVID pandemic as customers stayed home. 

Bloomberg News previously reported that the company was mulling bankruptcy if a buyer didn’t surface. The company also had plans to move to an online-only model but it’s unclear whether that will happen, the employee said. The company didn’t respond to a request for comment. 

The news was earlier reported by NBC. 

Jenny Craig employs more than 1,000 workers and corporate and salaried field employees’ last day will be May 5, according to the report, while hourly center employees’ last working day was Tuesday. Workers will receive a final paycheck, including full compensation through their last working day as well as unused paid time off, NBC said. 

--With assistance from Brandon Sapienza.

Proposed Canadian grocery code lays out process to resolve disputes, impose sanctions

The Canadian Press

Efforts to craft a Canadian grocery code of conduct have reached a major milestone with a proposed final version that includes a process to resolve disputes and impose sanctions on systemic violators of the code. 

However, the language in a copy of the proposed code obtained by The Canadian Press appears to stop short of imposing fines on companies that fail to adhere to its principles. 

Still, Michael Graydon, co-chair of the steering committee overseeing the industry-developed code, said the voluntary code has a number of potential deterrence measures to encourage compliance, such as potentially publicizing "consistent bad behaviour."

"It has teeth. Are they as sharp as some may like? Maybe not," said Graydon, also the CEO of supplier industry group Food, Health & Consumer Products of Canada.

"But if we get alignment and co-operation, we may not need to have to resort to fines anyways."

The grocery code is about creating more balance in industry's supplier-retailer relationships, Graydon said. 

"This is not rocket science," he said. "This is just good business practice."

The industry committee working on the grocery code was established in response to contentious fees being charged to suppliers by large grocery retailers, which have significant bargaining power due to their scale.

The code is intended to address long-standing issues such as arbitrary fees, cost increases imposed without notice and late payments.

"Parties to the code have an obligation to negotiate with one another in good faith and conduct business in the spirit of fair and ethical dealing," the copy of the proposed code reads. 

"Parties to the code may not alter contracts unilaterally."

Gary Sands, senior vice-president of public policy for the Canadian Federation of Independent Grocers, said the code aims to treat all industry members equally.

"There's no distinction made as to whether you're a small player or a big player," he said. "Everyone's treated equally."

A consultation process on the proposed code is open to food industry members until May 30.

Diane J. Brisebois, president and CEO of the Retail Council of Canada, which represents the country's largest grocers, said it's important for the code to allow grocery retailers to continue to offer consumers "a wide assortment of products at competitive prices."

Grocers want to ensure that the code will "ultimately benefit consumers," she said. 

They want the code to be "easy to understand and comply with, favouring simplicity and fairness over detailed rules and unnecessary complexity," Brisebois said in an emailed statement. 

She said this would safeguard against unnecessary red tape costs that would negatively impact stakeholders in the grocery supply chain and ultimately Canadian consumers.

The issue of supplier-grocer disputes came to a head in 2020 when Walmart Canada announced a fee hike that prompted United Grocers Inc., a national buying group that represents Metro Inc., to tell suppliers it expected the same.

Within months, Loblaw Companies Ltd. moved in the same direction, telling suppliers the cost of getting products on shelves would rise to help fund improvements to the grocer’s in-store and digital operations.

Industry observers at the time cautioned that the trend of big grocers using their market weight to impose fees without negotiations could lead to less competition, higher food costs and fewer brands on store shelves.

The industry-led grocery code of conduct was proposed as a way to address those issues and to ensure smaller, independent grocers have fair access to goods.

Data breach exposes clients' personal information at one of Canada's largest investment firms

Some Mackenzie Investments clients were impacted by a cyber security incident that took place at the end of January (Pexels).

Hannah Alberga
CTV News Toronto Multi-Platform Writer
Published May 3, 2023 7:31 a.m. MDT

Clients’ names, social insurance numbers and personal addresses were part of a data breach at one of Canada’s largest investment firms.

Toronto-based Mackenzie Investments confirmed to CTV News Toronto on Wednesday that a third party vendor, InvestorCOM Inc., was compromised by a cyber security incident related to data transfer supplier GoAnywhere.

According to a letter dated April 27 that was sent to a client and obtained by CTV News Toronto, InvestorCOM informed Mackenzie of the incident on March 28. The letter was signed by Mackenzie President and Chief Executive Officer Luke Gould.

The account number, name, address and social insurance number of the Mackenzie client who received the letter last week were part of the data breach.

“For clarity, financial information, such as client holdings and account balances, was not exposed in the incident. It is also important to note that investors’ holdings in Mackenzie funds were not impacted and our systems have not been compromised,” the letter states.

Hackers took advantage of a zero-day vulnerability in GoAnywhere’s file transfer system and accessed customers’ data at the end of January, according to the company.

Organizations around the world were impacted by the ransomware attack, including Proctor and Gamble, Rubrik, and the City of Toronto.

“After receiving notice from InvestorCOM, we took immediate steps to begin a full forensic investigation. Through our investigation, we recently discovered some personal information of current and some former investors was part of this incident,” a Mackenzie spokesperson said in a statement on Wednesday.

The spokesperson said there has been no evidence of data misuse at this point in time and that the company reported the incident to the federal privacy commissioner, in addition to provincial privacy commissions.

In response, Mackenzie said it is offering impacted customers credit monitoring alerts, identity theft protection services, fraud victim assistance and identity theft insurance.

“Mackenzie takes privacy and data protection very seriously and we are committed to protecting the confidentiality of all personal information. We greatly regret any concern or inconvenience this incident may cause to our valued clients,” a company spokesperson said.

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