TORONTO, July 7, 2014 /CNW/ - The Mutual Fund Dealers Association of Canada ("MFDA") has commenced a disciplinary proceeding in respect of Edward S. Brown (the "Respondent"). In its Notice of Hearing dated May 12, 2014, Staff of the MFDA alleges that the Respondent engaged in the following conduct contrary to the By-laws, Rules and/or Policies of the MFDA:
Allegation #1: Between about November 2003 and April 2007, the Respondent misrepresented, failed to fully and adequately explain, or omitted to explain the risks, benefits, material assumptions, features and costs of a leveraged investment strategy that he recommended and implemented in the accounts of 9 clients, thereby failing to ensure that the leveraged investment strategy was suitable for the clients and in keeping with the clients' investment objectives, contrary to MFDA Rules 2.2.1 and 2.1.1.
Allegation #2: Between about November 2003 and April 2007, the Respondent failed to ensure that the leveraged investment strategy that he recommended and implemented in the accounts of 9 clients was suitable for the clients and in keeping with their investment objectives, having regard to the clients' relevant Know-Your-Client information and financial circumstances, including but not limited to the clients' ability to withstand investment losses and afford the costs associated with the investment loans and, contrary to MFDA Rules 2.2.1 and 2.1.1.
The first appearance in this matter will take place by teleconference before a Hearing Panel of the MFDA's Atlantic Regional Council on July 10 at 11:00 a.m. (Atlantic) in order to schedule a date for the commencement of the hearing on the merits and to address any other procedural matters. The first appearance will be open to the public, except as may be required for the protection of confidential matters.
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its 110 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: Hugh Corbett, Managing Director, Enforcement, 416-943-4685, [email protected]