MFDA Imposes Series of Sanctions For Blank, Pre-Signed Forms and Unsuitable Leveraging
The MFDA has engaged in a series of enforcement proceedings regarding both blank pre-signed forms and unsuitable leveraged investment strategies.
Blank Pre-signed Forms:
Agreed to a fine of $5,000 and costs of $2,500 for obtaining, maintaining and sometimes using 21 blank, pre-signed trade forms in respect of 16 clients. A copy of the Reasons for Decision is found here.
Agreed to a fine of $10,000, costs of $2,500 and probation from acting in a compliance or supervisory capacity for 6 months for using 74 blank pre-signed account forms or photocopies of partially complete pre-signed account forms which he altered after clients had signed the forms in respect of 30 client accounts. A copy of the Settlement Agreement is found here.
Agreed to a fine of $7,500 and costs of $2,500 for maintaining 72 pre-signed and/or altered photocopied account forms for 13 clients. A copy of the Reasons for Decision is found here.
Adams Agreed to costs of $7,500 and completion of an “industry compliance course acceptable to the MFDA” within 6 months of the Settlement Agreement for signing new account applications and for obtaining blank pre-signed new account opening forms and investment loan application forms for at least 13 clients which he forwarded to a third party to complete. A copy of the Reasons for Decision and Settlement Agreement may be found here.
Unsuitable Leveraged Investment Strategies
Following a hearing on the merits and an agreed statement of facts, the Respondent was fined $25,000, ordered to pay costs of $7,500 and subject to a 5 year prohibition from conducting securities related business for failing to explain the risks, costs and ensure the suitability of a leveraged investment strategy for 9 clients. A copy of the Reasons for Decision is found here.