The representative misappropriated client funds and obstructed an investigation into their actions
The Canadian Investment Regulatory Organization (CIRO) concluded a penalty hearing for Juan Carlos Saavedra on September 25.
The hearing panel found that Saavedra violated Mutual Fund Dealer Rules by misappropriating or failing to account for client funds and refusing to cooperate with an investigation into his conduct.
CIRO's investigation revealed that Saavedra had engaged in this misconduct between July and October 2021.
Saavedra admitted to misappropriating $56,065 from a client's account by forging the client's signature on account documentation without their knowledge.
He directed the proceeds from unauthorized redemptions of the client's Tax-Free Savings Account (TFSA) to his personal bank account.
Additionally, he set up pre-authorized contributions into the TFSA without the client’s consent and associated his own bank account with the client's to facilitate unauthorized transactions.
When confronted about the withdrawals in October 2021, Saavedra falsely claimed that they resulted from a cyber-attack.
The client subsequently reported the unauthorized redemptions to AGF Investments Inc., which notified Saavedra’s employer, PFSL Investments Canada Ltd. PFSL terminated Saavedra's registration later that month and reimbursed the affected client.
Saavedra’s misconduct extended to other clients. CIRO found that he misappropriated approximately $127,693 from five insurance clients of an affiliate of PFSL during the same period. The Alberta Insurance Council fined him $105,000 for these actions.
Saavedra also faced a criminal conviction for uttering a forged document, resulting in a court order requiring him to pay $73,515 in restitution by May 2025.
Throughout the investigation, Saavedra failed to cooperate fully. CIRO repeatedly requested banking records to verify how the misappropriated funds were used. Saavedra provided only partial records for one account and withheld complete documentation.
CIRO’s hearing panel emphasized that this lack of cooperation hindered their ability to determine the full scope of his actions or identify whether additional clients were affected.
The panel imposed a permanent prohibition on Saavedra from conducting securities-related business with any CIRO Dealer Member.
They also ordered him to pay a $100,000 fine, split equally between the misappropriation and failure to cooperate, as well as $5,000 in costs for the investigation and proceedings.
CIRO’s decision highlighted the severity of Saavedra's misconduct, which they described as intentional, deceptive, and harmful to public trust in the securities and insurance industries.
