The firm that took over management of Pro-Financial Asset Management Inc.’s (PFAM) funds is rebranding itself as Smart Investments Ltd.
The Mississauga, Ont.-based firm, which was formerly known as Kingship Capital Corp., said Friday that it has acquired all of PFAM’s discretionary agreements and all its investment fund management agreements.
The deal was approved by the Ontario Securities Commission (OSC) back in July, and was consummated on Dec. 31, 2014. As a result, Smart is now the investment manager of the funds and portfolio manager of all discretionary managed accounts.
The OSC initially rejected Kingship’s proposed acquisition of PFAM, but later approved it with several conditions, including that a deal to bolster its capital go ahead and that the firm hire a compliance consultant. Smart Investments reports that North Star Compliance and Regulatory Solutions Inc. has been retained to provide ongoing regulatory compliance support.
PFAM and a couple of its former executives are facing an enforcement allegations from the OSC, including that the firm failed to keep adequate books and records, had insufficient internal controls, and failed to maintain enough capital. Those allegations stem from a discrepancy that occurred in the accounting for certain principal-protected notes (PPNs), incorrectly calculating MERs, and other alleged accounting issues. The allegations have not been proven. The next hearing in the case is currently scheduled for Feb. 25.
Smart says that it will be rebranding the Pro-Index Funds and making changes to the fund lineup, amid plans to grow its assets both organically and through strategic acquisitions.