TORONTO, April 9, 2015 /CNW/ - The Mutual Fund Dealers Association of Canada ("MFDA") commenced a disciplinary proceeding in respect of Mohamed Tahir (the "Respondent") by Notice of Hearing (the "Notice of Hearing") dated December 19, 2014.
A disciplinary hearing in this matter was held on April 7-8, 2015 in Toronto, Ontario before a three-member Hearing Panel of the MFDA's Central Regional Council. After hearing the evidence and submissions from Staff of the MFDA, the Hearing Panel found that the following four (4) allegations concerning the Respondent had been established:
Allegation #1: Commencing March 31, 2014, the Respondent failed to cooperate with an investigation concerning client complaints that he may have engaged in unauthorized activity in client accounts and may have misappropriated or failed to account for client monies, by failing to provide a written statement and produce documents and records requested by MFDA Staff during the course of an investigation, contrary to section 22.1 of MFDA By-law No. 1 and MFDA Rule 2.1.1.
Allegation #2: Between June 2003 and December 2011, the Respondent prepared and submitted new account application forms and investment loan applications for client AP which the Respondent knew or ought to have known contained false, misleading or incorrect information, thereby failing to observe the high standards of ethics and conduct in the transaction of business and engaging in conduct unbecoming an Approved person, contrary to MFDA Rule 2.1.1.
Allegation #3: Between June 2003 and December 2011, 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 to at least client AP, thereby failing to ensure that the leveraged investment recommendations were suitable for the client's and in keeping with the client's investment objectives, contrary to MFDA Rules 2.2.1 and 2.1.1.
Allegation #4: Between June 2003 and December 2011, the Respondent failed to ensure that the leveraged investment recommendations he made to client AP were suitable for the client and in keeping with the client's investment objectives, having regard to:
the client's relevant "Know Your Client" information and personal and financial circumstances, including but not limited to the client's ability to afford the costs associated with the investment loans and withstand investment losses; and
the Member's requirements regarding the use of leveraging, as set out in the Member's policies and procedures;
contrary to MFDA Rules 2.2.1 and 2.1.1.
The Hearing Panel imposed the following sanctions on the Respondent and advised that it will issue written reasons for its decision in due course:
- a permanent prohibition from conducting securities related business in any capacity over which the MFDA has jurisdiction;
- a fine in the amount of $175,000; and
- costs in the amount of $10,000.
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its 104 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: Shaun Devlin, Senior Vice-President, Member Regulation, Enforcement, 416-943-4672, email@example.com