Silver investment tarnished by bureaucracy
Plunging price was just the start of Montreal couple’s headache
Remember the silver frenzy of 1979-80? Ken Burrows certainly does. Worst investment he ever made. On Jan. 18, 1980, the former Gulf Oil employee lined up for two hours at the Guardian Trust Co. branch on what was then Dorchester Blvd. for the privilege of paying $1,153.40 for a precious-metal certificate confirming his ownership of 20 ounces of silver bullion. He paid $57 an ounce. “It was going up like crazy and I thought we should have some,” said his wife, Joan Burrows.
“I thought about giving up and just going to the bank and getting a GIC, but we didn’t have cellphones then and I would have lost my place in line if I’d gone to call Joan,” Ken said.
The speculative bubble that drove silver from $11 an ounce to more than $50 turned out to be an attempt by U.S. oilman Nelson Bunker Hunt and his brother, William Herbert Hunt, to corner the world market in that metal. When the bubble burst early in 1980, silver plunged right back to $11. Thirty-three years later, it’s still only half the price Burrows paid.
What was already his worst investment has since become a little worse.
The 84-year-old decided recently to tidy up his financial affairs, which included cashing in his silver certificate, presumably worth a little over $500 at current prices.
Easier said than done. When Burrows brought the original certificate to a downtown branch of the Canadian Imperial Bank of Commerce (which had acquired Guard-
“It’s not about the money. It’s the principle. We’ve got a legitimate certificate.”
JOAN BURROWS
ian Trust), he was initially told that storage charges would have reduced the investment to nothing.
Except his certificate clearly stated that storage fees for 100 ounces or less were $1 a year, payable upon redemption.
Then he was told that laws had changed and he and his wife needed a bullion account — something the company would have advised them about in writing, but perhaps a notice was sent to their old address, the one on the certificate. Except they haven’t moved. “We’ve lived at the same address for 56 years,” said Joan, 80.
Finally, the bank advised them by letter that “all outstanding certificates from Guardian Trust Co. were transferred to CIBC on Dec. 16, 1992, along with a list of all outstanding silver certificates at that time. However, as your silver certificate number is not on the list, CIBC is not in a position to liquidate it for you.”
The Burrowses aren’t taking the dismissal lightly, and are thinking of taking the matter to Quebec’s securities regulator, L’Autorité des marchés financiers.
“It’s not about the money anymore. It’s the principle. We’ve got a legitimate certificate. We’ve got the bill of sale. Why is it our problem that they can’t find it? Why would a big bank do that? It disappoints me,” Joan said.
Ken wonders how many other Canadians have been dispossessed in moves and mergers.
“They took over Guardian. I assume they also took over their liabilities and assets,” Ken said. “It’s too easy just to say, ‘Our records show this never existed.’ ”