The Ombudsman for Banking Services and Investments (OBSI) reports Octagon Capital Corporation has refused to compensate one if its elderly customers in the amount of $181,339.
This is only the second refusal to compensate ever received by OBSI from an investment firm.
A complaint was brought to OBSI recently by one of Octagon’s older investors, who was primarily a low-risk investor. Despite her profile, it says her advisor had traded frequently in her accounts and often without her authorization.
The securities he purchased were too risky, says OBSI, as he used margin and short selling strategies.
Additionally, it says the advisor at the centre of the client’s complaint was also the subject of an Investment Industry Regulatory Organization of Canada (IIROC) hearing concerning unsuitable investments and unauthorized trading in her account.
The IIROC Panel fined the advisor $125,000 and suspended his registration as a result of his actions.
Read the investigation report. Names and information has been removed to protect the parties involved.