MFDA Hearing Panel accepts Settlement Agreement with Equity Associates Inc.

TORONTO, April 15, 2015 /CNW/ - A Settlement Hearing in the matter of Equity Associates Inc. (the "Respondent") was held on April 13, 2015 in Toronto, Ontario before a three-member Hearing Panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada ("MFDA"). The Hearing Panel accepted the Settlement Agreement ("Settlement Agreement") between Staff of the MFDA and the Respondent, as a consequence of which the Respondent:

  • has paid a fine in the amount of $40,000;
  • has paid costs in the amount of $10,000; and
  • shall in future comply with MFDA Rules 2.2.1, 2.2.2, 2.2.3, 2.1.1 and MFDA Policy No. 3 and the Respondent shall uphold the standard of conduct in the industry in accordance with MFDA Rule 2.1.1.

In furtherance of the Settlement Agreement, the Respondent also made a payment of $50,000 as part of the terms of settlement of a civil claim that clients DH and EH commenced against the Respondent with respect to the same issues that gave rise to this disciplinary proceeding.

In the Settlement Agreement, the Respondent admitted that:

1)

on or about July 4, 2008, it opened two new joint accounts for clients DH and EH without ensuring that:





(a)  

it obtained a New Account Application Form or other form documenting the Know-Your-Client information applicable to each of the two new joint accounts in a manner which conformed with the requirements of MFDA Rule 2.2.1, contrary to MFDA Rules 2.2.2 and 2.1.1; and





(b) 

a designated trading partner, director or officer, approved the opening of the new joint accounts prior to or promptly after the completion of the initial transactions in the accounts, contrary to MFDA Rules 2.2.3 and 2.1.1.



2)

between July 4, 2008 and April 27, 2009, it failed to ensure that it learned the essential facts relative to two new joint accounts of clients DH and EH and failed to ensure that the orders that were accepted and the investment recommendations that were made in respect of the joint accounts of clients DH and EH were suitable for clients DH and EH, in keeping with their investment objectives, and within the bounds of good business practice, contrary to MFDA Rules 2.2.1 and 2.1.1; and



3)

commencing in July 2009, it failed to ensure that a complaint by clients DH and EH concerning the losses they sustained in their joint accounts was handled promptly and fairly, contrary to MFDA Rules 2.1.1 and 2.11 and MFDA Policy No. 3.

The Hearing Panel advised that it will issue written reasons for its decision in due course. 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 carried on business in all Canadian provinces except for Saskatchewan.

The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its 104 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.

SOURCE Mutual Fund Dealers Association of Canada

For further information: Shaun Devlin, Senior Vice-President, Member Regulation, Enforcement, 416-943-4672, sdevlin@mfda.ca

RELATED LINKS
http://www.mfda.ca

Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890