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When you invest, the government wants to protect you from being taken advantage of. This is one reason why the sale of investments in Canada is a regulated industry. Regulation means that the government has rules for who can sell you investments and for how these people have to treat you. Your legal rights and the government’s rules are different for different types of investments. Deposit-type Investments are one type and include guaranteed investment certificates. Securities are the other type and include stocks and mutual funds. We will look at the regulation and then at the rights for each of these two main types of investments.

Regulation of Deposit-type Investments

Most investments which earn interest are known as deposit-type investments. You can buy guaranteed investment certificates (GICs), term deposits and other deposit-type investments from a bank or similar place. The rules for banks, trust companies, loan companies and insurance companies are made by the Government of Canada. This means the rules are the same whether you live in Nova Scotia or in any other province. The Government of Canada is known as our federal government so the companies that have to follow these rules are known as Federally Regulated Financial Institutions (FRFIs).