A former registered representative with Dundee Securities Inc. has been fined $200,000 by the Investment Industry Regulatory Organization of Canada (IIROC) for failing to use due diligence to ensure that recommendations were suitable for his clients.
In a settlement agreement released on Friday, IIROC outlines penalties facing James Gwilym Jones, a former registered rep at a sub branch office of Dundee Securities in Calgary.
According to IIROC, Jones admitted that he failed to use due diligence to learn and remain informed of the essential facts relative to six clients, and failed to use due diligence to ensure recommendations were suitable for those clients.
Specifically, between March 2004 and March 2009, Jones recommended an aggressive growth trading strategy for six clients who were either retired or approaching retirement and inexperienced investors. The clients ended up losing approximately $1,174,000 in the investments.
“[Jones] failed to use due diligence to ensure the recommendation of any security for his clients was suitable for them based on factors including the clients’ financial situation, investment knowledge, investment objectives and risk tolerance,” IIROC said.
Jones has agreed to pay a $200,000 fine and costs of $10,000, and he’s prohibited from registration with IIROC in any capacity for five years.
Jones was terminated from Dundee in December 2009, following a client complaint. He has not worked in a registered capacity for an IIROC member firm since then.