The Autorité des marchés financiers reports that it brought almost 2,000 charges, sanctioned 1,200 people and companies, and levied $5.6 million in monetary penalties, as part of its enforcement efforts in 2011.
Reporting its enforcement figures for last year, the AMF says that it laid a total of 1,999 charges in 2011. Illegal distributions were the most common type of offence prosecuted in Quebec, with 29 suits brought against 76 individuals and companies, 21 concluded cases involving 37 individuals and companies, and 12 freeze and cease trade orders issued against 70 individuals and companies carrying out suspicious distribution activities.
“Illegal distributions and practices are key areas of focus for the AMF and account for much of our investigations and litigations, and our consumer education and assistance programs,” explained Nathalie Drouin, executive director, AMF enforcement and legal affairs. “It is important that we continue to suppress fraud by seeking harsh dissuasive sanctions, and further our efforts to educate consumers so they can better protect themselves against fraud.”
A total of 1,201 individuals and companies were sanctioned in 2011. The vast majority, 945 individuals and companies, were sanctioned or named in decisions related to registration, including 679 suspended certificates for non-payment of dues to the Chambre de la sécurité financière. And, 167 individuals and companies sanctioned for late filing of insider trading reports or failure to file reports.
In more serious enforcement cases, 52 individuals and 35 companies were sanctioned following decisions by the Quebec review board or a penal court for violations under the Securities Act; and, eight individuals and companies were sanctioned in court for violations under the Distribution Act.
A total of $5.5 million in penalties were handed down, including $4.5 million in fines imposed for failures or violations under the Securities Act. Thee were also $502,300 in fines imposed for insider trading reporting failures; $190,300 in administrative penalties imposed by the Bureau; $242,321 in administrative penalties imposed by the AMF; $133,500 in fines for violations under the Distribution Act; $67,500 in administrative penalties imposed on individuals or companies for failures or violations under the Distribution Act; and, $10,000 in fines for violations under the Securities Act.
The AMF says it also faced a growing number of contested hearings. In 2011, it was involved in 35 appeals brought before various Quebec courts.
In terms of protective orders, the AMF says it obtained a total of 15 orders against 89 individuals and companies to cease securities activities and to freeze assets. “This essential power, which enables the AMF to protect investors against potential losses during an investigation, was broadened in December 2011,” notes Drouin. “The AMF will now be able to request suspension and cancellation of registration, cease trade orders and any other remedial measure for violations… This is a significant consumer protection measure.”