VANCOUVER, Nov. 2, 2011 /CNW/ - A Hearing Panel of the Investment
Industry Regulatory Organization of Canada has found that Carolann
Steinhoff violated IIROC rules by making discretionary purchases in a
client account, making unsuitable use of margin, making unsuitable
investments for clients and making a false statement to her firm's
In its decision dated October 6, 2011, the panel also dismissed charges that Ms.
Steinhoff failed to consider the rate of return for a client's
investment, and that she failed to ensure that a client's account
documentation was accurate.
The panel will schedule a hearing to determine the penalty against Ms.
Steinhoff. The penalty hearing date will be made available at www.iiroc.ca.
Specifically, the panel found that Ms. Steinhoff:
Made 12 discretionary purchases in a client's account totaling $240,000,
contrary to IIROC Rule 1300.4;
Purchased securities in a client's account using approximately $120,000
borrowed on margin when that level of margin was not suitable for the
client, contrary to IIROC Rule 1300.1 (p) and (q);
Constructed a portfolio in a client's account which was not suitable for
the client, contrary to IIROC Rule 1300.1 (p) and (q);
Recommended that a client continue with previously purchased investments
even though the portfolio was not suitable for the client, contrary to IIROC Rule 1300.1 (q); and
Engaged in conduct unbecoming and detrimental to the public interest,
contrary to IIROC Rule 29.1, by making a false statement to her firm's compliance department
regarding her client's use of margin.
The panel also found that IIROC failed to prove that Ms. Steinhoff:
Failed to determine or consider the rate of return the client was
Failed to ensure the New Client Application Form reflected the fact that
the client's funds would be needed in approximately four months.
The violations occurred during the period of June to November 2008,
while Ms. Steinhoff was a Registered Representative at the Victoria, BC
branch of Wellington West Capital Inc., an IIROC-regulated firm. She is
currently registered with the Victoria branch of Queensbury Securities
Inc., an IIROC-regulated firm.
* * *
IIROC investigates possible misconduct by its member firms and/or
individual registrants. It can bring disciplinary proceedings which may
result in penalties including fines, suspensions and permanent bans or
terminations for individuals and firms.
All information about disciplinary proceedings relating to current and
former member firms is available in the Enforcement section of the IIROC website. Background information regarding the
qualifications and disciplinary history, if any, of advisors currently
employed by IIROC-regulated firms is available free of charge through
the IIROC AdvisorReport service. Information on how to make investment dealer, advisor or
marketplace-related complaints is available by calling 1.877.442.4322.
IIROC is the national self-regulatory organization which oversees all
investment dealers and trading activity on debt and equity marketplaces
in Canada. Created in 2008 through the consolidation of the Investment
Dealers Association of Canada and Market Regulation Services
Inc., IIROC sets high quality regulatory and investment industry
standards, protects investors and strengthens market integrity while
maintaining efficient and competitive capital markets.
IIROC carries out its regulatory responsibilities through setting and
enforcing rules regarding the proficiency, business and financial
conduct of dealer firms and their registered employees and through
setting and enforcing market integrity rules regarding trading activity
on Canadian equity marketplaces.
SOURCE Investment Industry Regulatory Organization of Canada (IIROC) - General News
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