TORONTO, Jan. 20, 2012 /CNW/ - A Settlement Hearing in the matter of Monarch Wealth Corporation (the "Respondent") was held today in Toronto, Ontario before a Hearing Panel of the MFDA's Central Regional Council.
The Hearing Panel accepted the Settlement Agreement between the Respondent and MFDA Staff, as a consequence of which the Respondent has paid a $60,000 fine and costs in the amount of $2,500. In the Settlement Agreement, the Respondent admitted that:
- between July 1, 2006 and December 31, 2008, it had established, implemented and maintained insufficient policies and procedures to supervise leveraged trades and ensure the suitability of leveraging recommendations made by Approved Persons to clients, contrary to MFDA Rules 2.2.1, 2.5, and 2.10 and MFDA Policy No. 2;
- between July 1, 2006 and December 31, 2008, it did not maintain sufficient records of the supervision of leveraged trading that was conducted by its Approved Persons, including records of trades reviewed, inquiries made, responses received and resolutions achieved, contrary to MFDA Rules 2.2.1 and 2.5 and MFDA Policy No. 2;
- it did not maintain its RAC level above zero following the transfer of funds from its operating bank account to a bank account operated by its parent company on: (1) June 1, 2009; (2) January 15, 2010; (3) February 1, 2010; and (4) March 1, 2010, contrary to MFDA Rule 3.1.1; and
- between January 2009 and March 2010 it did not immediately notify the MFDA that its RAC level became less than zero on four occasions, contrary to MFDA Rule 3.1.2.
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its 125 Members and their approximately 75,000 Approved Persons with a mandate to protect investors and the public interest.
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