MFDA Hearing Panel approves three settlement agreements

TORONTO, Feb. 28, 2020 /CNW/ - On February 27, 2020, a three-member Hearing Panel of the Central Regional Council of the Mutual Fund Dealers Association of Canada ("MFDA") heard the following three settlement proceedings, the particulars of which are:

Stephen Cragg

A hearing in the matter of Stephen Christopher Gilbert Cragg ("Cragg") was held on February 27, 2020 at which the Hearing Panel approved the settlement agreement dated December 6, 2019 ("Settlement Agreement") between Staff of the MFDA and Cragg, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $25,000;
• costs in the amount of $5,000;
• shall successfully complete the Ethics and Professional Conduct Course offered by the IFSE Institute, or an industry course acceptable to Staff of the MFDA, within six months of the acceptance of the Settlement Agreement; and
• shall in the future comply with MFDA Rules 2.1.4, 1.1.2 (as it relates to 2.5.1) and 2.1.1.

In the Settlement Agreement, Cragg admitted that:

a)	commencing no later than August 23, 2005, he engaged in personal financial dealings with client LW that gave rise to a conflict or potential conflict of interest with the client which he failed to disclose to the Member or otherwise address by the exercise of responsible business judgment influenced only by the best interests of the client, contrary to the Member's policies and procedures and MFDA Rules 2.1.4, 1.1.2 (as it relates to 2.5.1) and 2.1.1;
b)	in November 2017, he made false and misleading statements to the Member during the course of an investigation by the Member into his conduct, contrary to MFDA Rule 2.1.1; and
c)	in November 2017, in response to a supervisory inquiry, he submitted a document to the Member relating to his personal financial dealings with a client, upon which he signed the client's signature, contrary to MFDA Rule 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, Cragg carried on business in the Peterborough and Pickering Ontario, areas.

Gary Sexton

A hearing in the matter of Gary William Sexton ("Sexton") was held on February 27, 2020 at which the Hearing Panel approved the settlement agreement dated January 30, 2020 ("Settlement Agreement") between Staff of the MFDA and Sexton, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $12,500;
• costs in the amount of $2,500; and
• shall in the future comply with MFDA Rule 2.1.1.

In the Settlement Agreement, Sexton admitted that:

a)	between February 2012 and February 2018, he, or his assistants for whom he was responsible, obtained, possessed, and used to process transactions, 29 pre-signed account forms in respect of 24 clients, contrary to MFDA Rule 2.1.1; and
b)	between February 2012 and December 2017, he, or his assistants for whom he was responsible, altered 37 account forms in respect of 35 clients by altering information on the account forms without having the client initial the alterations, contrary to MFDA Rule 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, Sexton carried on business in the Grimsby, Ontario, area.

Samuel Bilton

A hearing in the matter of Samuel Francis Bilton ("Bilton") was held on February 27, 2020 at which the Hearing Panel approved the settlement agreement dated January 10, 2020 ("Settlement Agreement") between Staff of the MFDA and Bilton, as a consequence of which the following sanctions were imposed:

• a fine in the amount of $13,500;
• costs in the amount of $2,500; and
• shall in the future comply with MFDA Rule 2.1.1.

In the Settlement Agreement, Bilton admitted that:

a)	in March 2018, he cut and pasted client signatures from copies of account forms previously signed by two clients onto two new account forms, and submitted the account forms for processing, contrary to MFDA Rule 2.1.1; and
b)	on October 29, 2018, he misled the Member during an investigation into his conduct when he falsely represented to the Member that two clients had signed account forms, when he had cut and pasted the clients' signatures on to the account forms, contrary to MFDA Rule 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, Bilton carried on business in the Oakville 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 81,000 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]

Related Links

www.mfda.ca