OSC varies MFDA penalty decision to add a $52,270 fine for misappropriation, emphasizing disgorgement.
The Mutual Fund Dealers Association of Canada (MFDA) Staff applied to the Ontario Securities Commission for a hearing and review of an MFDA hearing panel decision.
The MFDA panel had permanently banned the respondent from the industry and ordered costs, but declined to impose a financial penalty for his misappropriation of $39,270 from a client's line of credit, citing his inability to pay and the fact that the bank reimbursed the client.
The Commission found that the MFDA panel erred in law and principle by permitting the respondent to retain the benefit of his misconduct, relying on irrelevant mitigating factors, and overemphasizing his inability to pay.
The Commission substituted its own decision, varying the MFDA order to include a fine of $52,270, representing disgorgement of the retained misappropriated funds plus an administrative penalty.
