TORONTO, July 4, 2022 /CNW/ – A Hearing Panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada (“MFDA”) has issued its Decision and Reasons dated July 4, 2022 (“Decision and Reasons”) in connection with a disciplinary hearing held electronically by videoconference in Toronto, Ontario on May 26, 2022 in the matter of Chanrith Yin (the “Respondent”).
In its Decision and Reasons, the Hearing Panel outlined its findings of misconduct made against the Respondent. In particular:
Allegation #1: Between March 2014 and July 2019, the Respondent misappropriated or otherwise failed to account for monies from clients and another individual, contrary to MFDA Rule 2.1.1.
Allegation #2: Between March 2014 and July 2019, the Respondent solicited or obtained monies from clients and another individual to invest in unapproved investments outside the Member, thereby engaging in:
- securities related business that was not carried on for the account of the Member and through the facilities of the Member, contrary to the Member’s policies and procedures, and MFDA Rules 1.1.1, 2.1.1, 1.1.2, and 2.5.1; or
- personal financial dealings with the clients, which gave rise to a conflict or potential conflict of interest which the Respondent failed to disclose to the Member, or failed to address by the exercise of responsible business judgment influenced only by the best interests of the clients, contrary to the Member’s policies and procedures, and MFDA Rules 2.1.4, 2.1.1, 1.1.2, and 2.5.1.
1 On June 30, 2021, MFDA Rule 2.1.4 was amended to conform with client focused reform amendments to National Instrument 31-103 that came into effect on the same day. As the conduct addressed in this Notice of Hearing pre-dated the amendment to this Rule, all allegations set out in this Notice of Hearing that make reference to that Rule concern the version of the Rule that was in effect between February 27, 2006 and June 30, 2021.
Allegation #3: Between November 2012 and January 20, 2020, the Respondent engaged in an outside business activity that was not disclosed to or approved by the Member, contrary to the Member’s policies and procedures, and MFDA Rules 1.2.1(c) (now 1.3), 2.1.1, 1.1.2, and 2.5.1
Allegation #4: Commencing in January 2020, the Respondent failed to cooperate with an investigation by MFDA Staff into his conduct, contrary to section 22.1 of MFDA By-Law No. 1.
In its Decision and Reasons, the Hearing Panel announced the following sanctions on the Respondent:
- a permanent prohibition from conducting securities related business in any capacity while in the employ of or associated with any MFDA Member;
- a fine in the amount of $1,724,210; and
- costs in the amount of $30,000.
A copy of the Decision and Reasons is available on the MFDA website at www.mfda.ca. During the period described in the Decision and Reasons, the Respondent conducted business in the London, Ontario area.
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its Members and their approximately 80,000 Approved Persons with a mandate to protect investors and the public interest. For more information about the MFDA’s complaint and enforcement processes, as well as links to ‘Check an Advisor’ and other Investor Tools, visit the For Investors page on the MFDA website.
2 MFDA Rule 1.2.1(c) was amended and renumbered as MFDA Rule 1.3 effective on March 17, 2016. In this case, Staff is alleging that the Respondent’s conduct was contrary to both versions of the Rule.
SOURCE Mutual Fund Dealers Association of Canada