TORONTO, June 13, 2024 Following a disciplinary hearing held on November 13, 2023, January 11, 2024 and March 7, 2024, a Canadian Investment Regulatory Organization (CIRO) hearing panel under the Mutual Fund Dealer Rules found that Zahir Hussain Lehri:
1) allowed an Approved Person who was not registered with the Member to:
a. open new accounts at the Member for clients;
b. complete and submit for processing Know-Your-Client forms;
c. implement a leveraging strategy for these clients using false or inaccurate client financial documentation; and
d. process trades in the accounts of these clients using the Respondent's representative code;
thereby:
a. facilitating stealth advising by the other Approved Person, and
b. failing to use due diligence to learn the essential facts relative to the clients and to ensure that the leveraging strategy and investments that were recommended and implemented for clients were suitable.
2) misappropriated or failed to account for monies received from a client and another individual, and
3) failed to cooperate with an investigation into his conduct by Staff of the MFDA.
The hearing panel's reasons for the decision on liability, dated June 7, 2024, are available at:
A separate hearing will be held to determine the penalty to be imposed on Zahir Lehri, the date of which will be made available at www.ciro.ca.
During the period described in the Notice of Hearing, Zahir Lehri conducted business in the Brampton, Ontario area.
The Canadian Investment Regulatory Organization (CIRO) is the national self-regulatory organization that oversees all investment dealers, mutual fund dealers and trading activity on Canada's debt and equity marketplaces. CIRO is committed to the protection of investors, providing efficient and consistent regulation, and building Canadians' trust in financial regulation and the people managing their investments. For more information, visit www.ciro.ca.
All information about disciplinary proceedings relating to current and former member firms and individual registrants under the Investment Dealer and Partially Consolidated Rules (for investment dealers), the Mutual Fund Dealer Rules (for mutual fund dealers) and the Universal Market Integrity Rules (UMIR) is available on CIRO's website.
Background information regarding the qualifications and disciplinary history, if any, of advisors currently employed by CIRO-regulated investment firms is available free of charge through the AdvisorReport service. Information on how to make dealer, advisor or marketplace-related complaints is available by calling 1-877-442-4322.
CIRO investigates possible misconduct by its member firms and individual registrants. It can bring disciplinary proceedings which may result in sanctions including fines, suspensions, permanent bars, expulsion from membership, or termination of rights and privileges for individuals and firms.
SOURCE Canadian Investment Regulatory Organization (CIRO)
Joanna Nicholson, Manager, Corporate Communications and Public Affairs, [email protected]
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