A British Columbia Securities Commission panel has overturned an Investment Industry Regulatory Organization of Canada hearing panel decision that a B.C. registered dealer and a registered representative contravened IIROC’s business conduct rules.
In September 2010, the IIROC hearing panel found that Blackmont Capital Inc. and Dean Shannon Duke contravened two IIROC rules when they agreed to share trading commissions with a third party. In December 2010, the panel imposed penalties on Blackmont and Duke.
Poorly documented third-party arrangement nets $1 million in fines from IIROC
After a hearing in September 2011, the BCSC panel found that the IIROC hearing panel had erred in law in making its findings, and set aside the IIROC hearing panel’s decision and penalties.
The BCSC panel found the IIROC panel erred by making a finding with no supporting allegation in the notice of hearing, and by finding the respondents’ contravention of another requirement to be conduct unbecoming when the contravention was merely technical. The panel said there was no evidence that the respondents’ conduct was intentional, was motivated by dishonest intent or for an improper purpose, or was otherwise unethical. The panel said the respondents’ conduct would not impair the public’s trust of the industry.
In the same decision, the BCSC panel confirmed the penalty the IIROC hearing panel imposed on Duke for a separate contravention.