A hearing of the Investment Dealers Association of Canada has found two approved persons at the Sudbury branch office Berkshire Securities Inc. guilty of hiding the true cost of three advertising campaigns.

Following a hearing held between April 3-6, 2006, the panel found that between January 2002 and February 2003, Denes Luciano Fransesco Peroni and Robert Paul Joseph Hétu failed to advise Berkshire of the true cost of three advertising campaigns carried out in co-operation with three mutual funds companies.

As a result of these misrepresentations, they received compensation exceeding what they were permitted to receive according to National Instrument 81-105. The panel also found that Hétu and Peroni knowingly misrepresented to Berkshire that an advertisement had appeared 12 times in a newspaper when it had only appeared four times.

The Hearing Panel noted that, “People who work in the investment industry have occasion to control other people’s money. The most fundamental expectation is that they do so honestly.”

The Panel also noted that NI 81-105 resulted from a concern that salespersons might give advice to their clients based upon incentives they would receive from mutual fund companies rather than their professional assessment of competing products. Its provisions were put in place to protect the public interest in having Approved Persons give objective advice to their clients.

The penalties to be assessed to Peroni and Hétu will be determined at a penalty hearing on a date to be determined by the IDA’s National Hearing Coordinator.