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MFDA Agreed Statement of Facts

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File No. 201819

IN THE MATTER OF A DISCIPLINARY HEARING PURSUANT TO SECTIONS 20 AND 24 OF BY-LAW NO. 1 OF THE MUTUAL FUND DEALERS ASSOCIATION OF CANADA

Re: Royston Nigel Kenyetta Thompson

Agreed Statement of Facts

I. INTRODUCTION

  1. By Notice of Hearing dated January 24, 2018, the Mutual Fund Dealers Association of Canada (“MFDA”) commenced a disciplinary proceeding against Royston Nigel Kenyetta Thompson (“Respondent”) pursuant to ss. 20 and 24 of MFDA By-law No. 1.
  1. The Notice of Hearing set out the following allegation:

Allegation #1:   Between July 2014 and April 2016, the Respondent obtained, possessed and, in some instances, used to process transactions, eleven pre-signed account forms in respect of four clients, contrary to MFDA Rule 2.1.1.

II. IN PUBLIC/ IN CAMERA

  1. The Respondent and Staff of the MFDA (“Staff”) agree that this matter should be heard in public pursuant to Rule 1.8 of the MFDA Rules of Procedure.

III. ADMISSIONS AND ISSUES TO BE DETERMINED

  1. The Respondent has reviewed this Agreed Statement of Facts and admits the facts set out in Part IV herein. The Respondent admits that the facts in Part IV constitute misconduct for which the Respondent may be penalized on the exercise of the discretion of a Hearing Panel pursuant to s. 24.1 of MFDA By-law No. 1.
  1. Staff and the Respondent jointly request that the Hearing Panel determine, on the basis of this Agreed Statement of Facts, the appropriate penalty to impose on the Respondent.

IV. AGREED FACTS

  1. Staff and the Respondent agree that submissions made with respect to the appropriate penalty are based only on the agreed facts in Part IV and no other facts or documents. In the event the Hearing Panel advises one or both of Staff and the Respondent of any additional facts it considers necessary to determine the issues before it, Staff and the Respondent agree that such additional facts shall be provided to the Hearing Panel only with the consent of both Staff and the Respondent.  If the Respondent is not present at the hearing, Staff may disclose additional relevant facts, at the request of the Hearing Panel.
  1. Nothing in this Part IV is intended to restrict the Respondent from making full answer and defence to any civil or other proceedings against him.

Registration History

  1. Since 2004, the Respondent has been registered in Ontario as a mutual fund salesperson (now known as a Dealing Representative) with PFSL Investments Canada Inc. (“PFSL”), a Member of the MFDA.
  1. The Respondent states that he became registered with PFSL in order to service his own mutual fund investments and those of his close friends.
  1. At all material times, the Respondent conducted business in the Whitby, Ontario area.

Allegation #1 – Pre-Signed Account Forms

  1. At all material times, PFSL prohibited its Approved Persons, including the Respondent, from using pre-signed account forms.
  1. On March 1, 2015 and January 19, 2016, in PFSL’s Annual Attestations for its Dealing Representatives, the Respondent stated that he would not obtain pre-signed account forms.
  1. Between July 2014 and April 2016, the Respondent obtained, possessed and, in some instances, used to process transactions, 11 pre-signed account forms in respect of 4 clients.
  1. The Respondent states that the 4 clients in whose accounts he obtained the pre-signed account forms are family or close friends.
  1. The pre-signed account forms consisted of redemption forms and customer service forms.

Misconduct Admitted

  1. By engaging in the conduct described above, the Respondent admits that he failed to observe a high standard of conduct and ethics in the transaction of business and engaged in conduct unbecoming an Approved Person, contrary to MFDA Rule 2.1.1.

Additional Factors

  1. Between 2014 and 2016, the Respondent earned the following commissions from PFSL:

Year

Commissions

No. of Clients

2014

$1,231.19

71

2015

$2,240.98

66

2016

$1,263.39

65

  1. At all material times, the Respondent was also employed as a police officer with the Regional Municipality of Durham.
  1. There is no evidence that the Respondent received any financial benefit from engaging in the misconduct described above other than the commissions or fees he would ordinarily be entitled to had the transactions been completed in the proper manner.
  1. There is no evidence of client loss or lack of authorization for the underlying transactions.
  1. The Respondent has not previously been the subject of MFDA disciplinary proceedings.

Execution of Agreed Statement of Facts

  1. This Agreed Statement of Facts may be signed in one or more counterparts which together shall constitute a binding agreement.
  1. A facsimile copy of any signature shall be effective as an original signature.

DATED: Jun 21, 2018

"Royston Nigel Kenyetta Thompson"

Royston Nigel Kenyetta Thompson

 

“Shaun Devlin ”

Staff of the MFDA
Per: Shaun Devlin
Senior Vice-President,
Member Regulation – Enforcement

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