Legal Issues

A hearing panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada has issued its Reasons for Decision in connection with a disciplinary hearing held in Toronto, Ontario on June 2, 2015, in the matter of Francis Dwight Zachary Dorrington.

In its Reasons for Decision, dated July 9, 2015, the hearing panel says it has imposed the following sanctions on the respondent:

  1. a prohibition from conducting securities related business in any capacity as an Approved Person of, or in association with, any Member of the MFDA for a period of two years;
  2. a fine in the amount of $20,000;
  3. costs in the amount of $10,000; and
  4. the respondent shall comply with items (b) and (c) before he is permitted to be re-registered in the mutual fund industry.

MFDA says that during the period described in the Reasons for Decision, the respondent carried on business in Brampton, Ontario. It adds he was charged with the following allegations.

Allegation #1: In October 2010, the respondent failed to ensure that an investment recommendation he made to clients BK and AK in respect of the sale proceeds of their house in the amount of $400,000 was suitable for them [regarding] their investment objectives, risk tolerance and time horizon, contrary to MFDA Rule 2.2.1(c).

Allegation #2: In October 2010, the respondent gave an undertaking in relation to the future value of a mutual fund he recommended to clients BK and AK for the purposes of effecting a trade in that security when he personally guaranteed to reimburse them for any decline in the value of their investment after one year, contrary to section 38(2) of the Securities Act (Ontario) and MFDA Rule 2.1.1.

Allegation #3: On or about October 13, 2011, the respondent engaged in unauthorized discretionary trading by processing a redemption in the amount of $33,335.40 in the account of clients BK and AK without their knowledge, instructions or approval, contrary to MFDA Rules 2.3.1 and 2.1.1.

For more details, read the Reasons for Decision document.

Originally published on Advisor.ca

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