The Investment Industry Regulatory Organization of Canada (IIROC) has fined a former financial advisor in British Columbia $80,000 for purchasing unsuitable investments in a client’s account and for failing to cooperate with an investigation.
Between 2008 and 2009, Simon Jaques, who was working at the Vancouver branch of Mackie Research Capital Corp., purchased high-risk stocks in a client’s registered retirement savings plan (RRSP). According to IIROC documents, the orders consisted of the purchase and sale of a silver exploration company called Orko Silver Corp., the purchase of stock in KCC Capital Corp., a capital pool corporation.
At the time, the client was 56 years old and retired. She was unable to work due to an illness and so depended on the investments for income. The client’s New Client Application Form (NCAF) stated her risk tolerance as follows: 25% low risk, 50% medium risk and 25% high risk.
Despite the high-risk allocation in the NCAF file, an IIROC hearing panel ruled that the purchase of these investments were unsuitable for the client given her overall risk tolerance, investment objectives and financial situation.
IIROC ordered Jaques to pay $30,000 for failing to use due diligence when placing orders for the client’s accounts. The remaining $50,000 of the total fine was levied against Jaques for his failure to cooperate with IIROC’s investigation into this matter.
In addition to the fine, Jaques is permanently banned from IIROC registration in any capacity and must pay $20,000 in costs.
Jaques is no longer a registrant with an IIROC-regulated firm.