BCSC uses new streamlined enforcement tool to levy $12,000 penalty on B.C. investment firm

VANCOUVER, BC, July 8, 2024 /CNW/ - An investment firm has paid $12,000 to the B.C. Securities Commission (BCSC) under a new enforcement mechanism in which financial penalties may be imposed without a hearing before a panel of commissioners.

This is the first penalty levied under the authority given to the BCSC in 2020 by amendments to the Securities Act, in which the Executive Director can directly impose an administrative penalty for violations of investment market rules. The BCSC is the only Canadian securities regulator to have this power.

BCSC Executive Director Peter Brady imposed the penalty on Capstone Asset Management Inc., a Langley firm registered under the Securities Act as an investment fund manager, exempt market dealer and portfolio manager, for failing to maintain the required level of insurance and for failing to have adequate compliance policies and procedures related to insurance.

The firm's underinsurance during that period followed a previous BCSC staff finding that the firm failed to comply with insurance requirements in 2018. There was no client harm.

The Executive Director said a $12,000 penalty was appropriate for the two violations combined. The firm did not dispute the finding and paid it.

"The purpose of Administrative Penalties Imposed by Notice is to address violations of investment rules that typically won't be serious enough to warrant a full-blown enforcement hearing," said Peter Brady, the Executive Director. "They help the BCSC encourage compliance with a wide range of industry rules that protect investors or make investment markets work efficiently."

About the B.C. Securities Commission (www.bcsc.bc.ca)

The B.C. Securities Commission, an independent provincial government agency, strives to make the investment market benefit the public. We set rules, monitor compliance by industry, take action against misconduct, and provide guidance to investors and industry. As guardians of B.C.'s investment market, we're committed to maintaining a market that is honest, fair, competitive and dynamic, enabling British Columbians to thrive. 

Learn how to protect yourself and become a more informed investor at www.investright.org

SOURCE British Columbia Securities Commission

Media Contact: Brian Kladko, 604-899-6713; Public inquiries: 604-899-6854 or 1-800-373-6393 (toll free), [email protected]