Settlement Agreement

I. INTRODUCTION

1. Staff of the Mutual Fund Dealers Association of Canada (“Staff”) and the Respondent, Maryanne Leslie Yu (the “Respondent”), consent and agree to settlement of this matter by way of this agreement (the “Settlement Agreement”).
2. Staff conducted an investigation of the Respondent’s activities which disclosed activity for which the Respondent could be penalized on the exercise of the discretion of the Hearing Panel pursuant to s. 24.1 of By-law No. 1.

II. JOINT SETTLEMENT RECOMMENDATION

3. Staff and the Respondent jointly recommend that the Hearing Panel accept the Settlement Agreement.
4. The Respondent admits to the following violations of the By-laws, Rules or Policies of the Mutual Fund Dealers Association of Canada (“MFDA”):
   1. Between October and November 2019, the Respondent:
      1. copied and pasted the signature of a client from an account form previously signed by the client onto a new account form; and
      2. signed a client’s initials on an account form, and submitted the account forms to the Member for processing, contrary to MFDA Rule 2.1.1.
5. Staff and the Respondent agree and consent to the following terms of settlement:
   1. the Respondent shall pay a fine in the amount of $9,500 in certified funds upon acceptance of the settlement agreement, pursuant to section 24.1.1(b) of By-law No. 1, upon acceptance of this Settlement Agreement;
   2. the Respondent shall pay costs in the amount of $2,500 in certified funds upon acceptance of the settlement agreement, pursuant to section 24.2 of By-law No. 1, upon acceptance of this Settlement Agreement;
   3. the Respondent shall in the future comply with MFDA Rule 2.1.1; and
   4. the Respondent will attend the Settlement Hearing in person (via videoconference).
6. Staff and the Respondent agree to the settlement on the basis of the facts set out in Part III herein and consent to the making of an Order in the form attached as Schedule “A”.

III. AGREED FACTS

Registration History

7. From April 24, 2015 to January 7, 2020, the Respondent was registered in Saskatchewan as a dealing representative with Scotia Securities Inc. (the “Member”), a Member of the MFDA.
8. On January 7, 2020, the Respondent resigned from the Member and she is no longer registered in the securities industry in any capacity.
9. At all material times, the Respondent carried on business in the Saskatoon, Saskatchewan area.

Copied and Pasted a Client Signature and Signed a Client’s Initials

10. At all material times, the Member’s policies and procedures prohibited its Approved Persons from falsifying client signatures under all circumstances.
11. On or about October 1, 2019, the Respondent submitted an Investment Directions form signed by client MM for processing. The Member returned the Investment Directions form to the Respondent and instructed her to obtain client MM’s signature that was missing in the Funding Details section of the form.
12. Rather than meeting with the client to obtain the client’s signature on the form, on or about October 2, 2019, the Respondent copied client MM’s signature from an account form previously signed by the client, pasted the client’s signature onto the Investment Directions section of the new account form, and submitted it to the Member for processing.
13. On or about November 8, 2019, the Respondent submitted to the Member an Investment Selector form signed by client CH containing updated KYC information. The Member returned the form to the Respondent because the date beside the client signature was incorrect. The Respondent was instructed to complete a new form with the correct date and re-submit the form for processing.
14. Rather than meeting with the client to complete a new form with the correct date, on or around November 8, 2019, the Respondent crossed out the incorrect date and wrote a new date of November 7, 2019, and signed the client CH’s initial beside the altered date. The Respondent then submitted this form to the Member for processing.

Member’s Investigation

15. In November 2019, the Member discovered the account forms that are described in this Settlement Agreement.
16. The Member contacted clients MM and CH, who confirmed that the transactions described above at paragraphs 12 and 14 were authorized.
17. The Member also conducted an audit of 25 randomly selected accounts for falsified signatures comparing them against customer signatures on file. No additional examples of copying and pasting of client signatures were found.

Additional Factors

18. The Respondent has not previously been the subject of a MFDA disciplinary proceeding.
19. There is no evidence that the Respondent received any financial benefit from engaging in the misconduct described above beyond any commissions and fees that he would ordinarily be entitled to receive had the transactions been carried out in the proper manner.
20. There is no evidence of any client loss, complaints, or that the transactions were unauthorized.
21. By entering into this Settlement Agreement, the Respondent has saved the MFDA the time, resources, and expenses associated with conducting a full hearing of the allegations.

IV. ADDITIONAL TERMS OF SETTLEMENT

22. This settlement is agreed upon in accordance with section 24.4 of MFDA By-law No. 1 and Rules 14 and 15 of the MFDA Rules of Procedure.
23. The Settlement Agreement is subject to acceptance by the Hearing Panel which shall be sought at a hearing (the “Settlement Hearing”). At, or following the conclusion of, the Settlement Hearing, the Hearing Panel may either accept or reject the Settlement Agreement. MFDA Settlement Hearings are typically held in the absence of the public pursuant to section 20.5 of MFDA By-law No. 1 and Rule 15.2(2) of the MFDA Rules of Procedure. If the Hearing Panel accepts the Settlement Agreement, then the proceeding will become open to the public and a copy of the decision of the Hearing Panel and the Settlement Agreement will be made available at mfda.ca.
24. The Settlement Agreement shall become effective and binding upon the Respondent and Staff as of the date of its acceptance by the Hearing Panel. Unless otherwise stated, any monetary penalties and costs imposed upon the Respondent are payable immediately, and any suspensions, revocations, prohibitions, conditions or other terms of the Settlement Agreement shall commence, upon the effective date of the Settlement Agreement.
25. Staff and the Respondent agree that if this Settlement Agreement is accepted by the Hearing Panel:
    1. the Settlement Agreement will constitute the entirety of the evidence to be submitted respecting the Respondent in this matter;
    2. the Respondent agrees to waive any rights to a full hearing, a review hearing or appeal before the Board of Directors of the MFDA or any securities commission with jurisdiction in the matter under its enabling legislation, or a judicial review or appeal of the matter before any court of competent jurisdiction;
    3. Staff will not initiate any proceeding under the By-laws of the MFDA against the Respondent in respect of the facts and contraventions described in this Settlement Agreement. Nothing in this Settlement Agreement precludes Staff from investigating or initiating proceedings in respect of any facts and contraventions that are not set out in this Settlement Agreement. Furthermore, nothing in this Settlement Agreement shall relieve the Respondent from fulfilling any continuing regulatory obligations;
    4. the Respondent shall be deemed to have been penalized by the Hearing Panel pursuant to s. 24.1.2 of By-law No. 1 for the purpose of giving notice to the public thereof in accordance with s. 24.5 of By-law No. 1; and
    5. neither Staff nor the Respondent will make any public statement inconsistent with this Settlement Agreement. Nothing in this section is intended to restrict the Respondent from making full answer and defence to any civil or other proceedings against the Respondent.
26. If, for any reason, this Settlement Agreement is not accepted by the Hearing Panel, each of Staff and the Respondent will be entitled to any available proceedings, remedies and challenges, including proceeding to a disciplinary hearing pursuant to sections 20 and 24 of By-law No. 1, unaffected by the Settlement Agreement or the settlement negotiations.
27. Staff and the Respondent agree that the terms of the Settlement Agreement, including the attached Schedule “A”, will be released to the public only if and when the Settlement Agreement is accepted by the Hearing Panel.
28. The Settlement Agreement may be signed in one or more counterparts which together shall constitute a binding agreement. A facsimile copy of any signature shall be effective as an original signature.