IIROC sets penalty hearing for Melaney Phillips

By Staff | August 22, 2011 | Last updated on August 22, 2011
2 min read

A hearing panel of the Investment Industry Regulatory Organization of Canada (IIROC) will meet to consider the appropriate penalty for Melaney Phillips.

In a decision dated June 8, 2011, the panel found that Phillips violated IIROC rules by making unsuitable recommendations for clients, one of whom was a senior in his 80s. The panel also found that she made discretionary purchases in a client account, performed client services for which she was not qualified and sold some of her own shares to a client without ensuring the client obtained the shares at the best available price.

Specifically, the panel found that Phillips:

  • recommended and purchased securities for two clients even though, in both cases, the investments were unsuitable for the clients’ investment objectives and tolerance for risk, contrary to IIROC Rule 1300.1 (q);
  • made unauthorized discretionary purchases in a client account, contrary to IIROC Rule 1300.4;
  • prepared tax returns for two clients and charged a fee for those services, without prior approval from her firm and without any formal training or designation, which constitutes conduct unbecoming and detrimental to the public interest, contrary to IIROC Rule 29.1; and
  • recommended and purchased shares for a client account from her own personal holdings. In doing so, she failed to advise the client that she had an interest in the transaction, which is conduct unbecoming and detrimental to the public interest, contrary to IIROC Rule 29.1. She also failed to take reasonable steps to ensure her client received the best available price for the shares, contrary to Part 8.1 of the Universal Market Integrity Rules (UMIR).

The violations occurred in 2007 and 2008, while Phillips was a registered representative with the Kelowna, British Columbia branch of Canaccord Genuity Corp., an IIROC-regulated firm. IIROC began its formal investigation into Phillips’ conduct on February 20, 2009. She is no longer registered with an IIROC-regulated firm.

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.