A fine of $200K is large, but the opportunity costs of having to sit out a full two-year suspension may be even greater for a young advisor losing his appeal in IIROC proceedings.
A former advisor’s appeal to the Ontario Securities Commission has been dismissed following his request to revisit his case in which he was banned and fined $200,000 for misrepresentation made to his compliance firm.
Julian Ricci, a former registered representative with the Burlington branch of Macquarie Private Wealth Inc., now known as Richardson GMP, received the sentence from the Investment Regulatory Organization of Canada (IIROC) after a hearing panel found that he inflated the net worth of several clients to allow them greater quantities of leverage than his firm’s requirements would allow.
His shoddy practices earned him a two-year suspension, but Ricci sought to have the ban repealed to an eight-month ban instead, which IIROC quickly dismissed.
“He engaged in conduct unbecoming of a registrant or detrimental to the public interest in that he made misrepresentations to his firm’s compliance staff by inflating the net worth of certain clients. He (also) falsely endorsed the signatures of several clients on account documentation and other forms,” as quoted in the report from the OSC.
The news comes as the OSC and IIROC are striving to rid the industry of crooked advisors who bend industry rules to make profits for themselves and also as CRM2 changes, which requires full disclosure to their clients and firms, are set to take effect in April.
Ricci argued that the suspension imposed by the Panel was unfit because in its consideration of all of the facts, the Panel misapprehended the evidence regarding: the type of investment strategy his clients were placed in; the number of clients with respect to whom Ricci made misrepresentations; and the fact that Ricci had only been licensed for two years at the time the misconduct took place.
However, the panel decided that the Evidence of Support from Ricci’s clients demonstrates Ricci’s character and his client’s satisfaction with the services that he provided to them was received in evidence and formed part of the body of evidence in the case.
As a result, IIROC holds that there is no basis to suggest that the Panel dealt unfairly or inappropriately with this evidence.
What’s more, Ricci’s business partner John Eley was also sanctioned for making misrepresentations and making false endorsements, but the Panel said that their decision was not based on Eley’s case.
“The Panel identified aggravating factors that Ricci engaged in a pattern of deliberate conduct that was designed to circumvent his firm’s policies and to go undetected, and that his conduct persisted for 16 months and only ceased when Ricci was confronted by his firm.”
Ricci will have to serve a 24 month suspension from registering and pay off all fines before being able to re-register with IIROC as an investment dealer. They add that his youth was weighed in the decision to not inflict a permanent ban.
Julian Ricci, a former registered representative with the Burlington branch of Macquarie Private Wealth Inc., now known as Richardson GMP, received the sentence from the Investment Regulatory Organization of Canada (IIROC) after a hearing panel found that he inflated the net worth of several clients to allow them greater quantities of leverage than his firm’s requirements would allow.
His shoddy practices earned him a two-year suspension, but Ricci sought to have the ban repealed to an eight-month ban instead, which IIROC quickly dismissed.
“He engaged in conduct unbecoming of a registrant or detrimental to the public interest in that he made misrepresentations to his firm’s compliance staff by inflating the net worth of certain clients. He (also) falsely endorsed the signatures of several clients on account documentation and other forms,” as quoted in the report from the OSC.
The news comes as the OSC and IIROC are striving to rid the industry of crooked advisors who bend industry rules to make profits for themselves and also as CRM2 changes, which requires full disclosure to their clients and firms, are set to take effect in April.
Ricci argued that the suspension imposed by the Panel was unfit because in its consideration of all of the facts, the Panel misapprehended the evidence regarding: the type of investment strategy his clients were placed in; the number of clients with respect to whom Ricci made misrepresentations; and the fact that Ricci had only been licensed for two years at the time the misconduct took place.
However, the panel decided that the Evidence of Support from Ricci’s clients demonstrates Ricci’s character and his client’s satisfaction with the services that he provided to them was received in evidence and formed part of the body of evidence in the case.
As a result, IIROC holds that there is no basis to suggest that the Panel dealt unfairly or inappropriately with this evidence.
What’s more, Ricci’s business partner John Eley was also sanctioned for making misrepresentations and making false endorsements, but the Panel said that their decision was not based on Eley’s case.
“The Panel identified aggravating factors that Ricci engaged in a pattern of deliberate conduct that was designed to circumvent his firm’s policies and to go undetected, and that his conduct persisted for 16 months and only ceased when Ricci was confronted by his firm.”
Ricci will have to serve a 24 month suspension from registering and pay off all fines before being able to re-register with IIROC as an investment dealer. They add that his youth was weighed in the decision to not inflict a permanent ban.
