Enforcement Notice Decision - IN THE MATTER OF Penson Financial Services Canada Inc. - Expedited Hearing

Feb 04, 2013, 17:02 ET from Investment Industry Regulatory Organization of Canada (IIROC) - General News

MONTRÉAL, Feb. 4, 2013 /CNW/ - Following an expedited hearing held on February 4, 2013, in Montréal, Québec with notice to Penson Financial Services Canada Inc. and Ernst & Young in its capacity as Liquidator of Penson Financial Services Canada Inc. (Penson) and with Penson's consent, a Hearing Panel of the Investment Industry Regulatory Organization of Canada (IIROC) has rendered the following decision:

        (a)      Penson's membership is immediately suspended;
        (b)      Except as required by paragraphs (c)-(h), inclusive, of this Order and as otherwise required to complete the liquidation of its business, Penson is directed to immediately cease dealing with the public as a Dealer Member;
        (c)      Penson shall provide notice of the claims process available to clients, as defined by and in accordance with the Claims Process Order;
        (d)      Penson shall report information and prepare and deliver certain documentation, forms or tax slips in respect of its clients and/or parties on behalf of which Penson provided services or held assets, for the 2012 and 2013 tax years and for any prior years as the case may be, in accordance with the Liquidation Order;
        (e)      Penson shall not pay distributions or other amounts to its shareholder, including distributions permitted by the Liquidation Order, without a further order of the Quebec Superior Court approving same;
        (f)      Penson shall preserve all books and records, including all hard copy and electronic records in its possession or control (including any computer servers, hard drives and any other electronically stored records in any form) (the "Records") for a period of seven (7) years of the date hereof, unless otherwise directed by the Quebec Superior Court or an IIROC Hearing Panel with notice of at least ten (10) days to IIROC;
        (g)      The Records shall be made available to IIROC staff on demand within a reasonable timeframe;
        (h)      Penson shall continue to prepare, deliver and file all documents required to be filed under IIROC Rules, including without limitation, all applicable registration filings, monthly and annual reports to IIROC, and monthly and quarterly investment statements when applicable;
        (i)      Upon IIROC staff's satisfaction that necessary liquidation steps have been performed, IIROC staff may proceed without further notice with an order terminating Penson's membership.

This Order shall come into effect immediately.

The panel's Order is available at http://docs.iiroc.ca/DisplayDocument.aspx?DocumentID=9912D75376E44FC0A84520F07B9078E6&Language=en.

The Notice of Application is available at http://docs.iiroc.ca/DisplayDocument.aspx?DocumentID=3948981E9A0D482A84A0906FC8200DF7&Language=en.

Documents related to ongoing IIROC enforcement proceedings - including Reasons and Decisions of Hearing Panels - are posted on the IIROC website as they become available. Click here to search and access all IIROC enforcement documents.

IIROC is the national self-regulatory organization which oversees all investment dealers and trading activity on debt and equity marketplaces in Canada. Created in 2008 through the consolidation of the Investment Dealers Association of Canada and Market Regulation Services Inc., IIROC sets high quality regulatory and investment industry standards, protects investors and strengthens market integrity while maintaining efficient and competitive capital markets.

IIROC carries out its regulatory responsibilities through setting and enforcing rules regarding the proficiency, business and financial conduct of dealer firms and their registered employees and through setting and enforcing market integrity rules regarding trading activity on Canadian equity marketplaces.

IIROC investigates possible misconduct by its member firms and/or individual registrants. It can bring disciplinary proceedings which may result in penalties including fines, suspensions, permanent bars, expulsion from membership, or termination of rights and privileges for individuals and firms.

All information about disciplinary proceedings relating to current and former member firms is available in the Enforcement section of the IIROC website. Background information regarding the qualifications and disciplinary history, if any, of advisors currently employed by IIROC-regulated firms is available free of charge through the IIROC AdvisorReport service. Information on how to make investment dealer, advisor or marketplace-related complaints is available by calling 1.877.442.4322.

SOURCE Investment Industry Regulatory Organization of Canada (IIROC) - General News