Outside business activity fine tops $320,000

By Staff | June 30, 2011 | Last updated on June 30, 2011
2 min read

A hearing panel of the Investment Industry Regulatory Organization of Canada (IIROC) has imposed its penalty against James Charles Dennis. The penalty follows the panel’s decision which found that Dennis failed to disclose certain outside business activities to his firm and its compliance staff.

The penalty against Dennis includes:

• A fine in the amount of $321,855.14, including disgorgement of $291,855.14, which was the net profit he earned from the outside business activities not reported to his firm; • A requirement to re-write and pass the Conduct and Practices Handbook examination before re-registering with an IIROC-regulated firm; • A requirement to be subject to strict supervision by his employer for one year from the date of being re-registered with an IIROC-regulated firm; and • Costs in the amount of $15,000.

“The fine also includes a further amount of $30,000 to reinforce the importance of deterring conduct of this nature,” the panel stated.

Specifically, in its earlier decision dated January 21, 2011, the panel found that Dennis entered into an arrangement in which he referred clients to a mutual fund advisor and received commission earnings in return. Dennis did not disclose this arrangement or the compensation to his employer, despite completing annual questionnaires for his firm about outside business activities. The panel found that his actions constituted conduct unbecoming or detrimental to the public interest, contrary to IIROC Rule 29.1.

The violations occurred between approximately June 2007 and September 2008, when Dennis was a Registered Representative with the Toronto branch of IPC Securities Corp, an IIROC-regulated firm. IIROC began the investigation into Dennis’ conduct in October 2008. He is no longer a registrant with an IIROC-regulated firm.

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