An advisor is scheduled to appear before a Hearing Panel for doing what many in the industry concede is a secretly common breach.
Ottawa advisor scheduled to appear before a Hearing Panel to discuss settlement regarding an ongoing industry problem that could soon be a thing of the past.
According to the MFDA between 2006 and 2013 Ottawa advisor Mansu Ding obtained, maintained, and in some instances, used to process trades, 96 blank pre-signed order entry forms in respect of 22 clients and altered and used to process trades, two order entry forms in respect of two (2) clients, contrary to MFDA Rule 2.1.1.
Advisors continue to use these pre-signed forms despite the fact the MFDA has zero tolerance for these kinds of infractions.
“The pre-signed forms [issue] is probably somebody just trying to get the business done,” Regina advisor Rod Tyler of the Tyler Group told WP Thursday while discussing his Invesco Canada Advisor Lifetime Achievement Award win at the Wealth Professional Awards. “Peak Investment Services [Tyler’s affiliated mutual fund dealer] in the MFDA world has been granted the ability to do things the same way as you do in the IIROC world. In other words, if a client phones you and you communicate in ways that can be documented and you document everything, you can execute trades that are within the Know Your Client parameters.”
Tyler’s talking about limited trading authorization.
“We have limited trading authorization which the client signs,” says Tyler. “If advisors are willing to do the right thing then I think they can certainly work with clients without having to have them in front of them all the time.”
While the LTA eliminates many of the issues related to pre-signed documents, an even better solution is the digital signature. Used extensively in the U.S., financial institutions in Canada are slowly coming around. For example, Tangerine uses mobile digital signature capture to enable clients to transfer their TFSA, RSP, or RIF from another financial institution.
The sooner digital signatures are commonplace in the advisor world, the sooner advisors can toss out their fax machines.
“If you’re an MFDA advisor you’re using a fax machine a lot,” says Assante Wealth Management advisor Glenn Szlagowski. “In the 21 st century do we really need to be using fax machines? Definitely, digital signatures, but they have to be legal.”
