The Investment Industry Regulatory Organization of Canada will hold a hearing to determine the penalty to be imposed on discount broker Questrade Inc. for setting client margin rates for foreign currency trading below those prescribed by IIROC minimum standards.

Questrade is engaged in three main lines of business: proprietary trading; online discount trading; and online foreign exchange (FX) trading.

Following a disciplinary hearing held on April 28, 2009, an IIROC hearing panel found that from December 2006 to the present, Questrade advertised FX margin rates below those prescribed by IDA and IIROC minimum standards, and failed to obtain required margin from its FX clients, despite being advised by regulatory staff.

The Investment Dealer’s Association of Canada formally initiated the investigation into Quetrade’s conduct on May 14, 2007. Questrade is currently an IIROC-regulated firm.

IE