The Mutual Fund Dealers Association of Canada (MFDA) has issued permanent bans against the founders of bankrupt fund dealer firm W.H. Stuart Mutuals Ltd. but no monetary sanctions yet.
Earlier this week, an MFDA hearing panel issued a decision in a disciplinary case, which found that the firm and one of its founders, Dianne Stuart, violated several MFDA rules, including failing to deal fairly and honestly with clients and misappropriating money in connection with a note scheme that allegedly took about $6 million from clients. It also found that the other founder, Howard Stuart, failed to co-operate with its investigation.
MFDA hearing panel finds W.H. Stuart, co-founder violated industry rules
Following a penalty hearing, the hearing panel ordered on Friday that the firm’s membership in the MFDA should be terminated and that the Stuarts should be banned permanently from conducting securities-related business for MFDA members.
The MFDA hearing panel also ordered the founders to pay $50,000 toward the costs of the hearing. The panel reserved its decision on the issue of monetary penalties against the respondents and indicated that it will issue its decision and written reasons “in due course.”
W.H. Stuart Mutuals was placed into bankruptcy in 2013.
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