The Investment Industry Regulatory Organization of Canada (IIROC) has fined and suspended former Montreal broker for his failings in recommending leveraged exchanged traded funds to two of his clients.
The violations occurred between October 2008 and April 2010, when Benoît Beaulne was a registered representative with the Montreal branch of Laurentian Bank Securities Inc.
Following a disciplinary hearing held on September 12, a IIROC hearing panel found that Beaulne failed to exercise due diligence to ensure his investment recommendations in leveraged ETFs constituted a suitable investment for two of his clients given their financial and personal circumstances and their investment objectives; and that he had sufficient knowledge of the features and risks inherent in the products before recommending them.
The hearing panel fined Beaulne $30,000, and ordered him to disgorge $1,490.72 in fees collected.
The panel also imposed a two-year suspension of approval in any capacity with an IIROC-regulated firm. He must successfully complete the Conduct and Practices Handbook examination before seeking re-approval and, in the event of re-approval, must be subject to strict supervision for a period of 12 months.
IIROC formally initiated the investigation into Beaulne’s conduct in July 2010. He is no longer registered with an IIROC-regulated firm.