MFDA Hearing Panel approves three settlement agreements

April 9, 2020 (Toronto, Ontario) – On April 9, 2020, a three-member Hearing Panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada (“MFDA”) heard the following three settlement proceedings, the particulars of which are:

Adrian Botescu

A hearing in the matter of Adrian George Botescu (“Botescu”) was held on April 9, 2020 at which the Hearing Panel approved the settlement agreement dated January 29, 2020 (“Settlement Agreement”) between Staff of the MFDA and Botescu, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $12,000;
• costs in the amount of $2,500;
• shall in the future comply with MFDA Rules 2.1.1 and 2.2.1.

In the Settlement Agreement, Botescu admitted that:

1. on or about May 17, 2018, in response to a supervisory inquiry from his branch manager regarding the suitability of a client’s investment holdings, he altered a client’s investment objective on a Know-Your-Client (“KYC”) account form without having met or discussed the information with the client, and also signed the client’s signature and initials on the account form, contrary to MFDA Rules 2.2.1 and 2.1.1;
2. on or about May 17, 2018, he created 2 meeting notes that falsely stated that he had met with a client to approve changes to the client’s KYC information, when he had not met with the client, and also signed the client’s initials on the meeting notes, contrary to MFDA Rule 2.1.1.; and
3. on or about May 25, 2018, he misled the Member during the course of its investigation into his conduct, when he falsely represented to the Member that he had met with a client to approve changes to the client’s KYC information, contrary to MFDA Rule 2.1.1.

A copy of the Settlement Agreement is available on the MFDA website at www.mfda.ca. During the period described in the Settlement Agreement, Botescu carried on business in the Toronto, Ontario, area.

Brian Sonne

A hearing in the matter of Brian Lundy Sonne (“Sonne”) was held on April 9, 2020 at which the Hearing Panel approved the settlement agreement dated February 6, 2020 (“Settlement Agreement”) between Staff of the MFDA and Sonne, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $20,000, payable in instalments as follows:
• $8,750 on April 9, 2020;
• $11,250 on August 7, 2020;
• costs in the amount of $2,500; and
• shall in the future comply with MFDA Rule 2.1.1.

In the Settlement Agreement, Sonne admitted that:

1. between September 2012 and October 2016, he altered and used to process transactions, 21 account forms in respect of 10 clients by altering information on the account forms without having the client initial the alterations, contrary to MFDA Rule 2.1.1;
2. between August 2013 and September 2015, he obtained, possessed and, in some instances, used to process transactions, 37 pre-signed account forms in respect of 9 clients, contrary to MFDA Rule 2.1.1; and
3. between February 2015 and November 2015, he cut and pasted client signatures from copies of account forms previously signed by 2 clients onto a total of 3 new account forms, and submitted the account forms to the Member for processing, contrary to MFDA Rule 2.1.1.

A copy of the Settlement Agreement is available on the MFDA website at www.mfda.ca. During the period described in the Settlement Agreement, Sonne carried on business in the Windsor, Ontario, area.

Cho-Tak “Albert” Lok

A hearing in the matter of Cho-Tak “Albert” Lok (“Lok”) was held on April 9, 2020 at which the Hearing Panel approved the settlement agreement dated February 3, 2020 (“Settlement Agreement”) between Staff of the MFDA and Lok, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $15,000, payable in instalments as follows:
• $6,250 on April 9, 2020;
• $8,750 on August 7, 2020;
• costs in the amount of $2,500; and
• shall in the future comply with MFDA Rule 2.1.1.

In the Settlement Agreement, Lok admitted that:

1. between January 2013 and January 2016, he altered and used to process transactions 11 account forms in respect of 10 clients by altering information on the account forms without having the client initial the alterations, contrary to MFDA Rule 2.1.1; and
2. between January 2012 and May 2018, he obtained, possessed and, in some instances, used to process transactions, 8 pre-signed account forms in respect of 7 clients, contrary to MFDA Rule 2.1.1.

A copy of the Settlement Agreement is available on the MFDA website at www.mfda.ca. During the period described in the Settlement Agreement, Lok carried on business in the Toronto, Ontario, area.

The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its Members and their approximately 81,000 Approved Persons with a mandate to protect investors and the public interest. For more information about the MFDA’s complaint and enforcement processes, as well as links to ‘Check an Advisor’ and other Investor Tools, visit the For Investors page on the MFDA website.