MFDA issues Notice of Hearing regarding M. Hershberg Capital Limited

TORONTO, Jan. 6 /CNW/ - The MFDA today announced that it has commenced disciplinary proceedings against M. Hershberg Capital Limited (the "Respondent").

MFDA staff alleges in its Notice of Hearing that the Respondent engaged in the following conduct contrary to the By-laws, Rules or Policies of the MFDA:

Allegation #1: From July 2004 to October 2008, the Respondent failed to ensure that trades in the accounts of clients were consistent with the clients' documented Know-Your-Client ("KYC") information in that purchase transactions of "medium/high" and "high" risk investments were made in accounts of clients who had a risk tolerance of "medium" recorded on their KYC forms, contrary to MFDA Rules 2.2.1 and 2.5.1.

Allegation #2: From July 2004 to May 2009, the Respondent engaged in discretionary trading in that trades were executed in client accounts:

(a)     pursuant to limited trading authorizations but absent evidence of specific client authorization; and

(b)     several days after receiving client authorization for trades,

contrary to MFDA Rules 2.3, 5.1(b), and 2.1.1.

Allegation #3: From July 2004 to May 2009, the Respondent engaged in unauthorized trading in that trades were executed in client accounts based on instructions from individuals other than the account holders or those granted trading authority over the accounts, contrary to MFDA Rule 2.1.1.

The first appearance in this matter will take place by teleconference before a Hearing Panel of the MFDA's Central Regional Council on January 27, 2011 at 10:00 a.m. (Eastern) in the hearing room located at 121 King Street West, Suite 1000, Toronto, Ontario. The purpose of the first appearance is to schedule a date for the commencement of the hearing on the merits and to address any other procedural matters and will be open to the public, except as may be required for the protection of confidential matters.

A copy of the Notice of Hearing is available on the MFDA website at www.mfda.ca.

The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its 136 Members and their approximately 75,000 Approved Persons with a mandate to protect investors and the public interest.


SOURCE Mutual Fund Dealers Association of Canada

For further information:

Shaun Devlin
Vice-President, Enforcement
416-943-4672 or sdevlin@mfda.ca


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