MFDA Hearing Panel accepts settlement agreement with Jason Savoy

TORONTO, Nov. 2, 2017 /CNW/ - A settlement hearing in the matter of Jason Andrew Savoy ("Respondent") was held today in Halifax, Nova Scotia before a three-member Hearing Panel of the Atlantic 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 following sanctions were imposed on the Respondent:

• a fine of $25,000 ("Fine");
• costs of $2,500 ("Costs");
• payment of the Fine and Costs shall be made to and received by MFDA Staff in certified funds as follows: 
  i. $2,500 (Costs) shall be paid upon acceptance of the Settlement Agreement;
  ii. $2,500 (Fine) on or before December 29, 2017;
  iii. $2,500 (Fine) on or before January 31, 2018;
  iv. $2,500 (Fine) on or before February 28, 2018;
  v. $2,500 (Fine) on or before March 29, 2018;
  vi. $2,500 (Fine) on or before April 30, 2018;
  vii. $2,500 (Fine) on or before May 31, 2018;
  viii.$2,500 (Fine) on or before June 28, 2018;
  ix. $2,500 (Fine) on or before July 31, 2018;
  x. $2,500 (Fine) on or before August 31, 2018; and
  xi. $2,500 (Fine) on or before September 28, 2018;

• if the Respondent fails to make any of the payments described above:
  a) any outstanding balance of the Fine owed by the Respondent shall immediately become due and payable to the MFDA;
  b) the Respondent shall continue to be prohibited from conducting securities related business while in the employ of or associated with a Member of the MFDA until such time as the total amount outstanding of the fine and costs owed by the Respondent is paid to the MFDA, pursuant to section 24.3.13(c) of MFDA By-law No. 1

• shall be prohibited from conducting securities related business in any capacity while in the employ of or associated with any MFDA Member for a period of 6 (six) months, commencing from the date of the Hearing Panel's Order;
• shall be prohibited from acting as a branch manager or in a supervisory capacity while in the employ of or associated with any MFDA Member for a period of 5 (five) years, commencing from the date of the Hearing Panel' s Order;
• shall successfully complete an ethics or other industry course acceptable to the MFDA within one (1) year of the Hearing Panel's Order; and
• in the future comply with MFDA Rules 1.1.2, 2.5.1, 1.2.1(c) (now MFDA Rule 1.3), 2.1.1, 2.1.4, MFDA Policy No. 3; and subsections 9.1(1) and (2) and 10.2(1) and (2) of the National Instrument 81-102; and

In the Settlement Agreement, the Respondent admitted that:
a) in or around December 2013, he agreed to personally reimburse a client the deferred sales charge fees the client would incur on a transaction, without the knowledge and approval of the Member, and then reneged on the agreement, contrary to MFDA Rules 2.1.4 and 2.1.1, and MFDA Policy No. 3;

b) between 2009 and 2014, he obtained and possessed ten (10) pre-signed client account forms in respect of seven (7) clients, contrary to the Member's policies and procedures and MFDA Rules 1.1.2, 2.5.1, and 2.1.1;

c) between April 2007 and October 2013, he accepted cash deposits from six (6) clients on 11 occasions, and used the cash deposits to purchase bank drafts to invest in mutual funds on the clients' behalf, contrary to the Member's policies and procedures and MFDA Rules 1.1.2, 2.5.1, and 2.1.1;

d) between October 2009 and August 2014, he delayed the processing of 20 transactions in the accounts of ten (10) clients, thereby failing to process trades in client accounts in a timely manner and consistent with, subsections 9.1 and 10.2 of the National Instrument 81-102, contrary to MFDA Rule 2.1.1;

e) between September 2012 and 2014, he compensated six (6) clients for fees incurred by the client as a result of investment losses due to errors or trade delays, without the Member's prior consent, contrary to the Member's policies and procedures and MFDA Rules 1.1.2, 2.5.1, and 2.1.1, and MFDA Policy No. 3;

f) between 2004 and 2013, he had and continued in a dual occupation by providing tax preparation services to 14 clients, which was not disclosed to and approved by the Member, contrary to the Member's policies and procedures and MFDA Rules 1.2.1(c) (now MFDA Rule 1.3), 1.1.2, 2.5.1, and 2.1.1;

g) between July 2014 and November 2014, he made misleading statements during the Member's investigation into his conduct, thereby interfering with the ability of the Member to supervise his conduct, contrary to MFDA Rule 2.1.1;

h) between 2007 and 2013, he misled the Member in annual compliance questionnaires when he falsely represented to the Member that he:
     i. did not arrange for and maintain pre-signed forms;
     ii. did not enter into financial settlements with clients that had not been approved by the Member; and
     iii. had disclosed and sought approval for outside business activities, thereby interfering with the ability of the Member to supervise his conduct, contrary to MFDA Rule 2.1.1; and

i) in January 2013 and December 2015, he failed to process transactions requested by two (2) clients on two (2) occasions, contrary to MFDA Rule 2.1.1.

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 conducted business in the Halifax, Nova Scotia area.

The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its Members and their approximately 83,000 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

Charles Toth, Director, Litigation, 416-943-4619, [email protected]