A hearing panel of the Investment Dealers Association of Canada (IDA), has fined a Vancouver broker $100,000 failing to act as a proper gatekeeper to the capital markets.

Stephen Brook Toban was an approved person at the Vancouver head office of Global Securities Corporation.

In its written liability decision released Nov. 20, 2006, the IDA found that Toban failed to properly perform his role as gatekeeper to the capital markets, in that, between approximately March 1999 and February 2001, he facilitated the opening of investment accounts for as many as 35 non-Canadian residents, some of whom had criminal or regulatory disciplinary histories, without making diligent inquiries to ensure that each client’s reason for opening an account was legitimate and intended for legitimate investment purposes.

Furthermore, between approximately September 2000 and February 2001, Toban facilitated certain transactional activity in the accounts previously noted without making diligent inquiries to ensure the legitimacy of the transactions in circumstances which should have called the transactional activity into question because it was peculiar, suspicious or appeared to be consistent with market manipulation, deception or other improper market related activity.

The panel also found that on or about Oct. 16, 2000, Toban effected transactions in a client’s account based on instructions he accepted from an individual who was not authorized to trade in the account.

Following penalty submissions heard on Dec. 20, 2006, Toban has been assessed a permanent ban from approval with an IDA Member firm, a fine of $100,000, and a payment of $25,000 in costs. In addition, Toban must disgorge $20,900 in commissions.

Toban has not been registered with an IDA member firm since Oct. 27, 2005.