Order

WHEREAS on November 11, 2020, 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 (the “Notice of Hearing”) in respect of a disciplinary proceeding commenced against Sean Preston Davidson (the “Respondent”) which shall take place before a hearing panel of the Central Regional Council (the “Hearing Panel”);

AND WHEREAS on January 12, 2021, the first appearance in this proceeding took place by teleconference before a public representative of the Central Regional Council of the MFDA (the “Chair of the Hearing Panel”);

AND WHEREAS the Chair of the Hearing Panel ordered that the hearing on the merits would proceed on June 21, 2021 & June 22, 2021 as an electronic hearing over videoconference;

AND WHEREAS on June 21, 2021, the Respondent did not attend the hearing on the merits;

AND WHEREAS the Hearing Panel decided to proceed in the absence of the Respondent, pursuant to section 20.4(b) of MFDA By-law No. 1 and Rules 7.3 and 13.5 of the MFDA Rules of Procedure;

AND WHEREAS the Hearing Panel considered the evidence presented and the submissions made by Staff of the MFDA;

AND WHEREAS the Hearing Panel finds that:

1. in or about February 2014, the Respondent engaged in personal financial dealings with a client when he borrowed or otherwise accepted approximately $18,000 from one or more clients, which gave rise to a conflict or potential conflict of interest which he failed to disclose to the Member or otherwise address by the exercise of responsible business judgment influenced only by the best interests of the client, contrary to the policies and procedures of the Member, and MFDA Rules 2.1.4, 2.1.1, 2.5.1 and 1.1.2;
2. between 2014 and 2017, the Respondent submitted three annual compliance questionnaires to the Member that contained false or misleading responses, thereby interfering with the ability of the Member to supervise the Respondent’s activities, engaging in conduct detrimental to the public interest, and failing to observe high standards of ethics and conduct in the transaction of business, contrary to MFDA Rule 2.1.1; and
3. between January 2015 and January 2017, the Respondent failed to disclose to the Member that he had filed a consumer proposal in January 2015, contrary to the Member’s policies and procedures, and MFDA Rules 2.1.1, 1.2.2(b) (now 1.4(b)), 2.5.1 and 1.1.2, and s. 4.1(g) of MFDA Policy No. 6.

IT IS HEREBY ORDERED THAT:

1. The Respondent is permanently prohibited from conducting securities related business while in the employ of or in association with a Member of the MFDA, pursuant to section 24.1.1(e) of MFDA By-law No. 1;
2. The Respondent shall pay a fine in the amount of $25,000, pursuant to section 24.1.1(b) of MFDA By-law No. 1;
3. The Respondent shall pay costs in the amount of $7,500, 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.