Notice of Hearing

NOTICE is further given that the MFDA alleges the following violations of the By-laws, Rules or Policies of the MFDA:

Allegation #1: On October 12, 2016, the Respondent processed a redemption in a client account based on instructions from someone other than the client, contrary to MFDA Rule 2.1.1 and 2.3.1.

PARTICULARS

NOTICE is further given that the following is a summary of the facts alleged and intended to be relied upon by the MFDA at the hearing:

Registration History

1. Since January 4, 1999, the Respondent has been registered in Manitoba as a mutual fund salesperson (now known as a dealing representative) with Investors Group Financial Services Inc. (“IG”), a Member of the MFDA.

2. At all material times, the Respondent carried on business in the Winnipeg, Manitoba area.

Allegation #1 – Unauthorized Redemption

3. At all material times, IG had policies and procedures in place that prohibited its approved persons form processing transactions in client accounts without client authorization.

4. At all material times, Client #1 and Client #2 were spouses and clients of IG, whose accounts were serviced by the Respondent.

5. At all material times, Client #1 had an individual non-registered account and a Registered Retirement Savings Plan (“RRSP”) account at IG, and Client #2 had a RRSP account and a Locked-In Retirement Account at IG.

6. On or about October 10, 2016, Client #2 contacted the Respondent and asked him to redeem $20,000 from Client #1’s non-registered account in order to purchase a vehicle.

7. On October 12, 2016, without speaking with Client #1 to obtain her authorization, the Respondent submitted to IG for processing the request to redeem $20,000 from Client #1’s non-registered account, pursuant to Client #2’s instructions.

8. On October 12, 2016, IG deposited $20,000 from Client #1’s non-registered account into a joint bank account belonging to Client #1 and Client #2. Client #2 subsequently withdrew the proceeds of the redemption.

9. On October 21, 2016, Client #1 advised the Respondent that she had received a transaction confirmation showing the $20,000 redemption described above, and did not consent to the redemption.

10. Subsequently, Client #1 confirmed to IG that she did not receive the benefit of the monies redeemed from her account, nor did she authorize Client #2 to receive the monies on her behalf.

11. By virtue of the foregoing, the Respondent processed a redemption in a client account based on instructions from someone other than the client, contrary to MFDA Rule 2.1.1 and 2.3.1.

NOTICE is further given that the Respondent shall be entitled to appear and be heard and be represented by counsel or agent at the hearing and to make submissions, present evidence and call, examine and cross-examine witnesses.

NOTICE is further given that MFDA By-laws provide that if, in the opinion of the Hearing Panel, the Respondent:

• has failed to carry out any agreement with the MFDA;
• has failed to comply with or carry out the provisions of any federal or provincial statute relating to the business of the Member or of any regulation or policy made pursuant thereto;
• has failed to comply with the provisions of any By-law, Rule or Policy of the MFDA;
• has engaged in any business conduct or practice which such Regional Council in its discretion considers unbecoming or not in the public interest; or
• is otherwise not qualified whether by integrity, solvency, training or experience,

the Hearing Panel has the power to impose any one or more of the following penalties:

1. a reprimand;
2. a fine not exceeding the greater of:
   1. $5,000,000.00 per offence; and
   2. an amount equal to three times the profit obtained or loss avoided by such person as a result of committing the violation;
3. suspension of the authority of the person to conduct securities related business for such specified period and upon such terms as the Hearing Panel may determine;
4. revocation of the authority of such person to conduct securities related business;
5. prohibition of the authority of the person to conduct securities related business in any capacity for any period of time;
6. such conditions of authority to conduct securities related business as may be considered appropriate by the Hearing Panel;

NOTICE is further given that the Hearing Panel may, in its discretion, require that the Respondent pay the whole or any portion of the costs of the proceedings before the Hearing Panel and any investigation relating thereto.

NOTICE is further given that the Respondent must serve a Reply on Enforcement Counsel and file a Reply with the Office of the Corporate Secretary within twenty (20) days from the date of service of this Notice of Hearing.

A Reply shall be served upon Enforcement Counsel at:

Mutual Fund Dealers Association of Canada
Prairie Regional Office
Suite 850, 800 – 6th Ave SW
Calgary, AB T2P 3G3
Attention: Sakeb Nazim
Fax: 403-266-8858
Email: [email protected]

A Reply shall be filed by:

1. providing four (4) copies of the Reply to the Office of the Corporate Secretary by personal delivery, mail or courier to:
   1. The Mutual Fund Dealers Association of Canada
      121 King Street West
      Suite 1000
      Toronto, ON M5H 3T9
      Attention: Office of the Corporate Secretary; or
2. transmitting one (1) electronic copy of the Reply to the Office of the Corporate Secretary by e-mail at [email protected].

A Reply may either:

1. specifically deny (with a summary of the facts alleged and intended to be relied upon by the Respondent, and the conclusions drawn by the Respondent based on the alleged facts) any or all of the facts alleged or the conclusions drawn by the MFDA in the Notice of Hearing; or
2. admit the facts alleged and conclusions drawn by the MFDA in the Notice of Hearing and plead circumstances in mitigation of any penalty to be assessed.

NOTICE is further given that the Hearing Panel may accept as having been proven any facts alleged or conclusions drawn by the MFDA in the Notice of Hearing that are not specifically denied in the Reply.

NOTICE is further given that if the Respondent fails:

1. to serve and file a Reply; or
2. attend at the hearing specified in the Notice of Hearing, notwithstanding that a Reply may have been served,

the Hearing Panel may proceed with the hearing of the matter on the date and the time and place set out in the Notice of Hearing (or on any subsequent date, at any time and place), without any further notice to and in the absence of the Respondent, and the Hearing Panel may accept the facts alleged or the conclusions drawn by the MFDA in the Notice of Hearing as having been proven and may impose any of the penalties described in the By-laws.

End.