I wrote to CIPF last Fall to ask about the protection we have. Here is their reply:

Dear Mr. ......,

At December 31, 2006, CIPF's Fund balance was $277 million, which is made up of $55 million in Treasury bills, $100 million in Federal Government bonds and $122 million in Provincial Government bonds.  CIPF also has lines of credit totaling $100 million with two Canadian chartered banks, providing our Fund with total resources of $377 million.

If CIPF's Fund balance was insufficient to cover claims from customers of insolvent Member firms, the Fund would be replenished with assessments paid by Member firms in the industry.

CIPF covers eligible customers, within defined limits, of Members who have suffered or may suffer financial loss solely as a result of the insolvency of a Member. Such loss must be in respect of a claim for the failure of the Member to return or account for securities, cash balances, commodities, futures contracts, segregated insurance funds [or other property] received, acquired or held by the Member in an account for the customer.

Regards,
Amy Lam
Canadian Investor Protection Fund


----- Original Message -----

I am concerned with respect to any exposure CIPF and/or either of my
brokers themselves
may have with respect to the over-the-counter cash derivatives markets
and/or the CDO, LBO, SIV markets.

I have sent three emails (over 6 weeks) of requests to two different CEOs
of .............. with only one response copying me his forwarding of my
concern to another CEO, who has not responded.

I believe there is a very seroius systemic threat to the frighteningly
leveraged, $500 Trilion global derivatives markets derivatives...now being
exposed as per Merrill, Citigroup and many more.(Citigroup is close to
insolvency when one sees their assets of approximately $2.3 Trillion to
their liabilities of $2.2 Trillion).

With respect specifically to the CIPF, you have listed approximately $275
million in cash and "investments". Are these investments or your $100
million lines of credit linked to any ABCP or other derivatives?

Should more than one of your members declare bankructy, what is your
fractional reserve capability? I am being advised to ask for all my stock
certificates in my posession to assure safeguard from a major crisis or
from their being loaned out of my margin accounts.

I would appreciate some response from you in order to help me clarify my
understanding of the above and/or take any action that may be prudent on a
timely basis.

Thank you in advance.