MFDA Hearing Panel approves settlement agreement with Jeffrey Beck

TORONTO, Jan. 23, 2019 /CNW/ - A settlement hearing in the matter of Jeffrey Michael Beck ("Respondent") was held yesterday in Toronto, Ontario before a three-person Hearing Panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada ("MFDA").

The Hearing Panel approved the settlement agreement dated January 17, 2019 ("Settlement Agreement") between Staff of the MFDA and the Respondent, as a consequence of which the following sanctions were imposed on the Respondent:

• a prohibition from conducting securities related business in any capacity while in the employ of or associated with a MFDA Member prior to September 1, 2019;
• a fine in the amount of $30,000, payable in instalments as follows:
• $10,000 on January 22, 2019;
• $5,000 on the first day of each month from February 1, 2019 to May 1, 2019; and
• costs in the amount of $5,000.

In the Settlement Agreement, the Respondent admitted that:

a)		between January 2011 and December 2015, he solicited and facilitated investments totaling approximately $2,260,850 in unsecured promissory notes issued by a company called Invoice Payment Systems Inc. (the "IPS Notes") by approximately 28 clients that were not processed through the facilities of the Member, International Capital Management Inc. ("ICM"), or recorded on its books and records without first exercising adequate due diligence to ensure that he understood the product sufficiently to:
		i.		"know the product" and the regulatory requirements applicable to the sale of the product;
		ii.		properly identify, disclose and explain the risks of the product to clients; and
		iii.		ensure that the orders that he accepted and the recommendations that he made to clients were within the bounds of good business practice and suitable for the clients;
contrary to MFDA Rules 1.1.1, 2.2.1 and 2.1.1;
b)		between January 2011 and December 2015, he knew or ought to have known that the solicitation of investments by clients of ICM in the IPS Notes, gave rise to a conflict of interest that he failed to disclose to clients in writing or to otherwise 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; and
c)		in December 2016, after the MFDA commenced disciplinary proceedings against ICM, John Sanchez and Javier Sanchez to address contraventions associated with the solicitation of investments in IPS Notes, he sent an improper client communication to a client that included assertions that were potentially misleading and likely to unjustifiably diminish the client's concerns about the gravity of the allegations addressed by Staff in its disciplinary proceeding against ICM, John Sanchez and Javier Sanchez, contrary to MFDA Rules 2.8.2, 2.1.4, 2.2.1 and 2.1.1.

A copy of the Settlement Agreement is available on the MFDA website at www.mfda.ca. During the period described in the Settlement Agreement, the Respondent conducted business in the Toronto, Ontario area.

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

Charles Toth, Managing Director, Litigation, 416-943-4619, [email protected]

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