A disciplinary hearing in the matter of Faisal Amin Satti and Kamran Ghani was held yesterday before a three-person hearing panel of the MFDA’s central regional council.
Satti was registered in Ontario as a mutual fund salesperson and branch manager with Carte Wealth Management before his termination in October 2008. Ghani was registered in Ontario as a mutual fund salesperson and branch manager with Monarch Wealth Corporation until April 2009.
The panel found the allegations set out in the notice of hearing dated April 20, 2012 had been established. They include:
Allegation #1: Between January 2008 and May 2008, Satti intentionally submitted client account opening documents and loan applications for 22 clients that contained false and misleading information, contrary to MFDA Rule 2.1.1.
Allegation #2: In almost all instances in Allegation #1, he submitted documents containing false or misleading information. He had clients sign the documents with limited or no information populated on the documents, and then completed the documents using information he knew to be false, contrary to MFDA Rule 2.1.1.
Allegation #3: Between November 5, 2007 and October 28, 2008, he fabricated documents in respect of 15 clients and submitted in support of new client account applications and loan applications, contrary to MFDA Rule 2.1.1.
Allegation #4: Between February 2008 and March 2008, he opened accounts in the names of IH and SV, each of whom he had never met, and also obtained investment loans in their names using the loan proceeds to purchase mutual funds for their accounts. All was done without the knowledge or approval of the clients, contrary to MFDA Rule 2.1.1.
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Allegation #5: In or about August 2008, Satti met with another client, MK, and obtained their signature on a different member’s account opening documents and loan application, for the purpose of implementing a leveraged investment strategy that he’d recommended to the MK. Satti then provided these documents to Ghani for processing, thereby engaging in securities related business that was not carried on for the account and through the facilities of Satti’s member and failing to treat MK fairly, contrary to MFDA Rules 1.1.1(a) and 2.1.1.
Allegation #6: By engaging in the conduct described in Allegation #5 above, Ghani failed to learn the essential facts relative to each client and each order accepted and failed to treat MK fairly, honestly and in good faith, contrary to MFDA Rules 2.2.1 and 2.1.1.
Allegation #7: Between February 2008 and May 2008, Satti facilitated stealth advising by Ghani—who was not registered as a mutual fund salesperson at the material time—by opening accounts for 12 clients under his (Satti’s) representative code, processing investment loan applications for the clients and purchasing mutual funds for the accounts of the clients, contrary to MFDA Rules 2.2.1 and 2.1.1.
Allegation #8: On or about June 9, 2008, Satti submitted an application for employment to a member containing false or misleading information, and also made false or misleading representations to the member concerning matters relating to the application, thereby engaging in conduct unbecoming an Approved Person, contrary to MFDA Rule 2.1.1.
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The hearing panel imposed the following penalties and costs at the conclusion of the hearing:
- Satti is permanently prohibited from conducting securities related business in any capacity while in the employ of or associated with any MFDA Member;
- Ghani is permanently prohibited from conducting securities related business in any capacity while in the employ of or associated with any MFDA Member;
- Satti shall pay a fine of $500,000;
- Ghani shall pay a fine of $150,000;
- Satti shall pay costs of $7,500; and
- Ghani shall pay costs of $7,500.