IIROC announces settlement with Paul Ryan Klemke

CALGARY, Jan. 17 /CNW/ - A Hearing Panel of the Investment Industry Regulatory Organization of Canada (IIROC) has accepted a Settlement Agreement between IIROC staff and Paul Ryan Klemke.

In the agreement, Mr. Klemke admitted to unauthorized trading in client accounts; violating his know-your-client and suitability obligations in certain trading in client accounts; and trading in a security that was not eligible for distribution.

Mr. Klemke has agreed to pay a $35,000 fine and $5,000 in costs. He has also agreed to being prohibited from reapplying for registration with IIROC until December 15, 2011. As conditions of re-approval in any category, Mr. Klemke will be required to successfully complete the Conduct and Practices Handbook examination and be subject to a one-year period of strict supervision.

Specifically, Mr. Klemke admitted to engaging in conduct unbecoming and detrimental to the public interest, contrary to IIROC Rule 29.1, by:

  • Making discretionary purchases of a single security in 42 separate client accounts without their knowledge, and/or consent and/or authorization;
  • Engaging in unauthorized trading by redeeming mutual funds in client accounts without the clients' knowledge and/or consent and/or prior authorization, in order to fund the above purchases; and
  • Selling and/or attempting to sell a security to residents of Saskatchewan when it was not eligible for distribution in that province.

IIROC began investigation into Mr. Klemke's conduct on May 15, 2008. The violations occurred in March and/or April 2008, when Mr. Klemke was a registered representative with a Calgary branch of Jennings Capital Inc., an IIROC-regulated firm. Mr. Klemke is no longer registered with an IIROC-regulated firm.

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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:

Warren Funt
Vice President, Western Canada
  Elsa Renzella
Director, Enforcement Litigation


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