June 3, 2021 (Toronto, Ontario) – A settlement hearing in the matter of Deryl Emerson Francis Thompson (“Respondent”) was held by electronic hearing on June 1, 2021, 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 May 5, 2021 (“Settlement Agreement”), between Staff of the MFDA and the Respondent, as a consequence of which the following sanctions were imposed on the Respondent:
- a permanent prohibition from conducting securities related business in any capacity while in the employ of or associated with any MFDA Member;
- a fine in the amount of $10,000 (“Fine”);
- costs in the amount of $3,750 (“Costs”);
- payment of the Fine and Costs shall be made as follows:
- $3,750 (Costs) in certified funds upon acceptance of the Settlement Agreement;
- $1,668 (Fine) on or before July 30, 2021;
- $1,668 (Fine) on or before August 31, 2021;
- $1,666 (Fine) on or before September 30, 2021;
- $1,666 (Fine) on or before October 29, 2021;
- $1,666 (Fine) on or before November 30, 2021; and
- $1,666 (Fine) on or before December 31, 2021.
In the Settlement Agreement, the Respondent admitted that:
- between 2008 and until at least July 2016, he failed to use adequate due diligence to ensure that investment recommendations that he made to clients were suitable when he recommended that the clients concentrate all or substantially all of their investment holdings in precious metals sector mutual funds, contrary to MFDA Rules 2.2.1 and 2.1.1;
- between 2008 and until at least July 2016, he failed to accurately record the essential KYC factors relevant to each client and to each order and account that he accepted, but instead recorded KYC information for each client that would be consistent with his investment recommendations to those clients to ensure that the investments appeared to be suitable, contrary to MFDA Rules 2.2.1 and 2.1.1; and
- between 2008 and until at least July 2016, he failed to adequately explain to clients the risks of holding investments concentrated in precious metals sector mutual funds and thereby failed to present the investment recommendations to clients in a fair and balanced manner, contrary to MFDA Rules 2.2.1 and 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, the Respondent conducted business out of the Edmonton, Alberta 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 80,000 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.