Subject: LAW
MFDA announces settlement hearing to take place in respect of International Capital Management Inc., John Paul Sanchez and Javier Andreas Sanchez
TORONTO, June 20, 2018 /CNW/ - The Mutual Fund Dealers Association of Canada ("MFDA") commenced a disciplinary proceeding in respect of International Capital Management Inc. ("ICM"), John Paul Sanchez ("John") and Javier Andreas Sanchez ("Javier") (collectively "Respondents") by Notice of Hearing dated May 30, 2017.
As the result of a settlement agreement entered into between Staff of the MFDA and the Respondents, the settlement hearing in this matter will take place June 21, 2018 commencing at 10:00 a.m. (Eastern) or as soon thereafter as the matter can be heard, in the hearing room at the offices of the MFDA, located at 121 King Street West, Suite 1000, Toronto, Ontario.
The subject matter of the proposed settlement agreement concerns matters for which the Respondents may be disciplined pursuant to ss. 20 and 24.1.1 of By-law No. 1 of the MFDA. In particular, the settlement agreement concerns allegations that:
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a) |
between 2006 and 2016, the Respondents engaged in securities related business that was not carried on for the account of ICM, through the facilities of ICM or recorded on the books and records of ICM, contrary to MFDA Rules 1.1.1 and 2.1.1. |
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b) |
since 2006, John and Javier have engaged in outside activities that were not approved by ICM in writing or reflected on the books and records of ICM, contrary to MFDA Rule 1.3.2(c); |
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c) |
since 2006, John and Javier solicited money from ICM clients for investment in two non-arm's length companies, thereby engaging in conduct that gave rise to conflicts of interest which the Respondents failed to address by the exercise of responsible business judgment influenced only by the best interests of the clients, contrary to MFDA Rules 2.1.4 and 2.1.1; |
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d) |
between 2006 and 2016, the Respondents recommended that ICM clients purchase investments distributed by two non-arm's length companies, without conducting adequate due diligence to know the products and to ensure that the products recommended and the orders obtained from clients were suitable, contrary to MFDA Rule 2.2.1; |
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e) |
after October 2006, the Respondents did not comply with the terms of an Agreement and Undertaking entered into between the Respondents and Staff, thereby engaging in conduct contrary to MFDA Rule 2.1.1 and engaging the authority of the Hearing Panel to impose a penalty on the Respondents pursuant to sections 24.1.1 and 24.1.2 of MFDA By-law No. 1; |
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f) |
between 2008 and December 2016, the Respondents failed to cooperate with Staff's investigations into their conduct, contrary to sections 22.1 and 22.2 of MFDA By-law No. 1; |
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g) |
since February 2009, the Respondents have not established, implemented and maintained policies and procedures required to ensure that adequate account and trade supervision was conducted, contrary to MFDA Rules 2.5.1 and 2.5.7, and MFDA Policy No. 2. |
MFDA settlement hearings are typically held in the absence of the public pursuant to section 20.5 of MFDA By-law No. 1 and Rule 15.2(2) of the MFDA Rules of Procedure. If the Hearing Panel accepts the settlement agreement, then the proceeding will become open to the public and a copy of the decision of the Hearing Panel and the settlement agreement will be made available at www.mfda.ca.
A copy of the Notice of Hearing is available on the MFDA website at www.mfda.ca.
The MFDA is the self-regulatory organization for Canadian mutual fund dealers, regulating the operations, standards of practice and business conduct of its Members and their approximately 82,000 Approved Persons with a mandate to protect investors and the public interest. For more information about the MFDA's complaint and enforcement processes, as well as links to 'Check an Advisor' and other Investor Tools, visit the For Investors page on the MFDA website.
SOURCE Mutual Fund Dealers Association of Canada
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