December 21, 2022 (Toronto, Ontario) – A settlement hearing in the matter of Funds Direct Canada Inc. (the “Respondent”) was held electronically by videoconference on December 20, 2022 in Regina, Saskatchewan before a three-member Hearing Panel of the Prairie Regional Council of the Mutual Fund Dealers Association of Canada (“MFDA”).
The Hearing Panel accepted the settlement agreement dated November 22, 2022 (the “Settlement Agreement”), between Staff of the MFDA and the Respondent as a consequence of which the following sanctions were imposed on the Respondent:
- a fine in the amount of $30,000 (“Fine”);
- costs in the amount of $5,000 (“Costs”);
- payment of the Fine and Costs shall be made in instalments as follows:
- $5,000 (Costs) on December 20, 2022;
- $10,000 (Fine) on or before January 31, 2023;
- $10,000 (Fine) on or before February 28, 2023;
- $10,000 (Fine) on or before March 31, 2023; and
- shall in the future comply with all MFDA By-laws, Rules and Policies, and all applicable securities legislation and regulations made thereunder, including MFDA Rules 2.2.1, 2.5, and MFDA Policy No. 2.
In the Settlement Agreement, the Respondent admitted that:
- between October 1, 2019 and September 30, 2020, it failed to conduct or maintain evidence of tier-one trade supervision, contrary to MFDA Rules 2.2.1(c), 2.5, and MFDA Policy No. 2;
- between October 1, 2019 and September 30, 2020, it failed to ensure that tier-one trade supervision was conducted on a timely basis, contrary to MFDA Rules 2.2.1(c), 2.5, and MFDA Policy No. 2; and
- between March 11, 2019 and December 2, 2020, it failed to adequately resolve supervisory queries, and resolve queries or on a timely basis, contrary to MFDA Rules 2.2.1(c), 2.5, and MFDA Policy No. 2.
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 76,695 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.