A CIBC Securities Inc. employee with dealings in both Squamish and Whistler was fined $15,000 for moving a client’s money without authorization and falsifying notes of approval.
At a Dec. 2, 2022 settlement hearing, a hearing panel of the Pacific Regional Council of the Mutual Fund Dealers Association of Canada upheld a settlement agreement between the Mutual Fund Dealers Association of Canada (MFDA) and Majid Hassanshahi.
The hearing panel accepted the settlement agreement dated Sept.12, 2022, between staff of the MFDA and Hassanshahi.
In the settlement, Hassanshahi was penalized $10,000 as well as $5,000 in costs for not obtaining a client’s consent and falsifying records indicating he had done so.
The reasons for the decision were published on Canlii.org on Jan. 20, 2023.
This issue between Hassanshahi and the client, who is unnamed in the decision, first occurred in February 2020.
“The respondent removed the client’s assets from the money market mutual fund and distributed them into four [CIBC] mutual funds,” reads the decision. “That same day, the respondent created a note … falsely indicating that he had received telephone instructions from the client before processing the switches.”
In April 2020, the client complained to CIBC that the money was moved without authorization. The client has since been compensated $960 for a decrease in portfolio value.
The decision states Hassanshahi admitted he acted in his own capacity and falsified the notes. Furthermore, there was no evidence presented that Hassanshahi received any financial benefit for his misconduct, and this was the first time he had been through disciplinary proceedings.
“By processing the switch without first obtaining the client’s authorization, the respondent did not act fairly, honestly or in good faith,” wrote the panel, adding that it was a serious contravention of the rules.
“Creating a false note to try to cover up the unauthorized switch was an even more serious contravention,” the decision continued. “Having regard to the relevant considerations, including general and specific deterrence and protection of the integrity of the capital markets, the settlement is within a reasonable range and is accepted.”
