The New Self-Regulatory Organization of Canada (New SRO) has fined and banned a representative for two years after she borrowed $105,000 from a close friend who was also a client, for investing in another client’s daycare business, for receiving rental income from two of her own properties and for failing to disclose all of these outside activities in annual attestations.
In addition to the two-year prohibition from re-registering with any firm regulated by the New SRO, Zinan Liu must also pay a $15,000 fine and costs in the amount of $5,000.
More specifically, between May 2018 and February 2020 when she was terminated by CIBC Securities Inc., the Burnaby, British Columbia dealing representative contributed money towards the establishment of a daycare business to be operated in Burnaby – the daycare was being established by her client, another approved person at the firm, carrying on business in the same branch. Liu says all four investors, herself and the other three were close friends and had been prior to either representative registering with the firm and prior to the other representative becoming and approved person.
In October 2018, meanwhile, Liu borrowed $105,000 from another friend who was her client, to use towards the purchase of her family home. There was no written agreement and reportedly no interest was paid on the loan, which was repaid in full in February 2019.
In all cases, there is no evidence that clients have suffered harm. None have complained to the firm or to the regulator. During the same time frame, Liu received rental income from two properties.
In January 2019 she completed and annual attestation stating that she had the firm’s permission for all outside activities, as required. Liu says at the time she signed the attestation she was unaware that she was required to obtain approval for the outside activities.
Despite the fact no clients have complained to the regulator or to the firm, Liu, who currently does not work in the securities industry, is barred from re-registration until 2025.
