Catherine Deborah Jones, an investment advisor in Vancouver, breached a number of compliance rules while working with a client between 2009 and 2010, according to a hearing panel of the Toronto-based Investment Industry Regulatory Organization of Canada (IIROC).

IIROC found that between 2009 and 2010 Jones, who works with Leede Financial Markets Inc., engaged in unauthorized discretionary trading, failed to ensure that the use of a margin account was appropriate for the client, misrepresented unsolicited trades as solicited and used a personal email to contact a client.

During the time in question, the client, who had recently sold her dental practice, was not in Vancouver and had made arrangements to receive a monthly income from her investments. The client, according to IIROC, believed this income came from dividends and investment gains and did not touch her principle.

Over the course of the year, a number of trades were made in the client’s accounts, says IIROC documents. However, the client maintains that she was never informed of these trades and the little communication she had with Jones at the time was in reference to the monthly income. It was also during this time frame that Jones contacted the client via a personal email account.

As well, the client had a margin account with Jones, which she claims she did not understand. According to IIROC documents, the client was not informed when a margin call was made on the account and furthermore the client did not know she was required to cover such a call with cash.

The IIROC hearing panel found that while the client’s net worth and personal situation allowed for a certain amount of risk, including a margin account, her margin account with Jones was used excessively.

Finally, Jones frequently processed trades made on behalf of the client as unsolicited, indicating that direction for the trade came from the client rather than the broker. According to Leede’s chief compliance officer, who testified before the hearing panel, the firm’s compliance system allows advisors to check off whether a trade was solicited or unsolicited. If the fields on the form are left empty, however, the system automatically marks the trades as solicited. Therefore, IIROC found that Jones purposefully marked the trades as unsolicited even though that was not the case.

IIROC has yet to set a penalty. Jones is currently a registered representative with the Vancouver branch of Global Securities Corp.