A hearing panel of the Investment Industry Regulatory Organization of Canada has found that a Quebec City broker violated the by-laws and rules of the Investment Dealers Association on several occasions
In a decision dated Dec. 12, 2011, the IIROC hearing panel found that Stéphane Rail obstructed an investigation conducted by the IDA (now IIROC), failed to use due diligence to learn and remain informed of the essential facts relative to his client and the person authorized on his client’s account, and accepted instructions from an unauthorized person.
The violations occurred while he was a registered representative at the Quebec City branch offices of TD Evergreen or Canaccord Capital Inc.
Specifically, the hearing panel found that:
> on Dec. 8, 2005 and on July 13, 2006, during examinations held by IIROC staff, Rail obstructed an investigation conducted by the IDA (IIROC) when he lied about the existence and/or involvement of a person in his client’s account;
> between September 1995 and April 2001, Rail failed to use due diligence to learn and remain informed of the essential facts relative to his client, namely the fact that the person identified as being authorized on the account had been deceased since December 1994;
> between September 1995 and March 2001, Rail violated regulations with respect to instructions on approximately 124 trades conducted in his client’s account which originated from an unauthorized person.
IIROC formally initiated the investigation into Rail’s conduct in November 2009. He is no longer a registrant with an IIROC-regulated firm.
A separate hearing will be held to determine the penalties to be imposed on Rail, IIROC said.