VANCOUVER, Jan. 20 /CNW/ - A Hearing Panel of the Investment Industry
Regulatory Organization of Canada (IIROC) has imposed a $732,500 fine
against Blackmont Capital Inc. and a $265,000 fine against Dean Shannon
Duke after an earlier decision found they had violated business conduct
and trade authorization rules.
As part of the penalty decision dated December 20, 2010, the panel also gave Mr. Duke a six-month
prohibition against re-approval for registration commencing January 1,
The penalty also stipulates that if Mr. Duke wants to apply for
re-registration after June 30, 2011, he must successfully complete the
Conduct and Practices Handbook examination and his first six months of
re-registration must be done under strict supervision.
The panel's earlier decision, dated September 1, 2010, had found that Blackmont and Mr. Duke had
violated IIROC rules when they:
participated in an arrangement which involved payment of commissions to
a third party who acted as an "external asset manager" for banks
resident in either Switzerland or Liechtenstein, and who placed orders
in the accounts of seven clients. Blackmont and Mr. Duke did not
disclose this arrangement to these clients, which constitutes business
conduct detrimental to the public interest, contrary to IIROC Rule 29.1 (formerly IDA By-law 29.1) and IIROC Rule 29.6 (formerly IDA By-law 29.6); and
effected trades in four client accounts based on third-party
instructions without having a written trading authorization, contrary
to IIROC Rule 200.1(i)(3) [formerly IDA Regulation 200.1(i) (3)].
The panel also found that Blackmont engaged in business conduct
detrimental to the public interest, contrary to IIROC Rule 29.1, when it failed to meet the requirements of the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations by failing to obtain the following documentation for certain client
(a) Corporate records which indicated the "power to bind" a
(b) Signature documentation regarding trading authorization; and/or
(c) Identity verification for authorized trading individuals.
All of these violations occurred between January 2003 and October 2007.
The IDA (now part of IIROC) began investigating Blackmont's conduct on
December 10, 2007, and Mr. Duke's conduct on February 1, 2008. The
violations occurred when Mr. Duke was a Registered Representative with
the Vancouver Branch of Blackmont. Mr. Duke is no longer registered in
any capacity with an IIROC-regulated firm.
Blackmont Capital Inc. is now Macquarie Private Wealth Inc., following a
name change on February 1, 2010. The firm was previously named First
Associates Investments Inc. before becoming Blackmont Capital Inc. in
* * *
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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