IIROC announces settlement for Nicholas Jason Budnik

MONTRÉAL, Nov. 4, 2011 /CNW/ - A Hearing Panel of the Investment Industry Regulatory Organization of Canada (IIROC) has accepted a Settlement Agreement, with sanctions, between IIROC staff and Nicholas Jason Budnik.

In this agreement Mr. Budnik admits that he engaged in unauthorized, excessive and discretionary trading for the purpose of generating commissions.

Pursuant to the agreement, the penalty against Mr. Budnik includes:

  • A $50,000 fine;
  • A disgorgement of $77,000 in profits;
  • The requirement that Mr. Budnik re-write the Conduct and Practices Handbook (CPH) examination within 12 months of the settlement being accepted;
  • A three-month suspension from registration with IIROC in any capacity; and
  • The requirement that, upon being re-registered with IIROC, Mr. Budnik be subject to strict supervision for 18 months, followed by close supervision for an additional six months, with strict and close supervision reports to be filed with IIROC's Registration department within 10 days of the end of each month for the entire period of supervision.

Mr. Budnik also agreed to pay costs in the amount of $3,000.

Specifically, Mr. Budnik has admitted that he:

  • Engaged in unauthorized discretionary trading in a client's accounts, even though the accounts had not been approved as discretionary accounts by his firm, contrary to IDA Regulations 1300.4 (now IIROC Rule 1300.4) and 1300.5 (now IIROC Rule 1300.5) ; and
  • Engaged in excessive trading for the purpose of generating commissions, without regard to the client's investment objectives, contrary to IDA Regulations 1300.1(b) and (c) (which became IDA Regulations 1300.1(o) and 1300.1(p) in 2004-2006, now IIROC Rules 1300.1(o) and 1300.1(p)).

The violations occurred between 2003 and 2006, while Mr. Budnik was a Registered Representative at the Montréal branch of Canaccord Capital Corporation (now Canaccord Genuity Corp.), an IIROC-regulated firm. IIROC began the investigation into Mr. Budnik's conduct in June 2009. He is no longer registered with 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

For further information:

Carmen Crépin
Vice President, Québec
Elsa Renzella
Director, Enforcement Litigation



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