VANCOUVER, Dec. 21 /CNW/ - On December 21, 2009, a Hearing Panel of the Investment Industry Regulatory Organization of Canada (IIROC) accepted a Settlement Agreement between the IIROC Staff and Canaccord Financial Ltd. (the "Respondent"). Pursuant to the Settlement Agreement, the Respondent admitted that:
In or about 2006 and 2007, the Respondent did not take steps to adequately ensure its sales staff understood the complexities of the third-party asset-backed commercial paper (ABCP) product it offered for sale to retail clients and the consequent risks (including systemic risks and counterparty risks) related to the product and, in not taking these adequate steps, did not ensure that the purchase of third-party ABCP was appropriately understood by its clients, contrary to Investment Dealers Association Regulation 1300.1(a) (now IIROC Dealer Member Rule 1300.1(a)).
Pursuant to the Settlement Agreement, the Hearing Panel imposed the following penalty against the Respondent:
(a) a fine in the amount of $3,100,000 (inclusive of costs); and
(b) an order to retain an independent consultant to carry out a
compliance review relating to due diligence practices and
procedures relating to fixed income securities.
IIROC formally initiated the investigation into the Respondent's conduct on May 7, 2008. The alleged violation occurred when the Respondent was a member firm of the Investment Dealers Association (IDA). The Respondent is currently an IIROC dealer member.
The Hearing Panel will issue its Reasons and Decision on a later date. The approved Settlement Agreement is available at: www.iiroc.ca.
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
For further information: For further information: Alex Popovic, Vice President, Enforcement, (416) 943-6904, email@example.com; Jeff Kehoe, Director, Enforcement Litigation, (416) 943-6996, firstname.lastname@example.org