Order

WHEREAS on January 8, 2018, the Mutual Fund Dealers Association of Canada (the “MFDA”) issued a Notice of Hearing pursuant to sections 20 and 24 of By-law No. 1 in respect of a disciplinary proceeding commenced against Hong Lam (the “Respondent”);

AND WHEREAS the first appearance in this hearing was held by teleconference before a panel of the Central Regional Council of the MFDA (the “Hearing Panel”) on March 22, 2018;

AND WHEREAS no one appeared on behalf of the Respondent, although properly served as appears from the Affidavit of Christopher Maniaci sworn on March 2, 2018; and the Affidavit of Terri Ash sworn on March 9, 2018;

AND WHEREAS on September 18, 2018, the Hearing Panel conducted a hearing of the matters as described in the Notice of Hearing;

AND WHEREAS the Hearing Panel is of the opinion that the Respondent:

1. between 2012 and 2015, engaged in securities related business that was not carried on for the account of the Member and through its facilities by recommending, selling, facilitating the sale of, and/or making referrals in respect of the sale of investments to approximately 24 clients and 3 individuals totaling approximately $2,016,660, contrary to the Member’s policies and procedures and MFDA Rules 1.1.1, 2.1.1, 2.4.2, 2.5.1 and 1.1.2 and the requirements of sections 13.7 and 13.8 of National Instrument 31-103;
2. had and continued in another gainful occupation, which was not disclosed to and approved by the Member, when:
   1. between 2011 and 2015, he was an officer and director of a company, and a partner of a company, which the Respondent operated to accept referral fees outside the Member; and
   2. in 2015, he failed to disclose that he had transferred his mortgage license to a new mortgage broker company,

   contrary to the Member’s policies and procedures and MFDA Rules 1.2.1(c) (now MFDA Rule 1.3), 2.1.1, 2.4.2, 2.5.1 and 1.1.2, and the requirements of sections 13.7 and 13.8 of National Instrument 31-103;

3. between 2012 and 2015, had unapproved referral arrangements with three Approved Persons who referred clients to invest outside the Member through him in exchange for referral fees paid directly or indirectly by him, contrary to the Member’s policies and procedures, MFDA Rules 2.1.1, 2.4.2, 2.5.1 and 1.1.2, and the requirements of sections 13.7 and 13.8 of National Instrument 31-103;
4. on November 15, 2015, misled the Member during an investigation by falsely stating that he had not referred any clients to invest in a real estate and development company, contrary to MFDA Rule 2.1.1; and
5. commencing on or about April 1, 2016, failed to cooperate with the MFDA during the course of an investigation into his conduct, contrary to section 22.1 of MFDA By-law No. 1.

IT IS HEREBY ORDERED THAT:

1. the Respondent’s authority to conduct securities related business in any capacity while in the employ of or associated with any MFDA Member shall be prohibited permanently, pursuant to section 24.1.1(e) of MFDA By-law No. 1;

2. the Respondent shall pay a fine in the amount of $250,000, pursuant to section 24.1.1(b) of MFDA By-law No. 1;

3. the Respondent shall pay costs in the amount of $10,000, pursuant to section 24.2 of MFDA By-law No. 1; and

4. if at any time a non-party to this proceeding, with the exception of the bodies set out in section 23 of MFDA By-law No. 1, requests production of or access to exhibits in this proceeding that contain personal information as defined by the MFDA Privacy Policy, then the MFDA Corporate Secretary shall not provide copies of or access to the requested exhibits to the non-party without first redacting from them any and all personal information, pursuant to Rules 1.8(2) and (5) of the MFDA Rules of Procedure.