The British Columbia Securities Commission (BCSC) announced January 23 that it has entered into a settlement with Haywood Securities Inc., after the firm allowed trading in accounts subject to a freeze order – now known as a preservation order – resulting in a loss of $931,553.40. Prior to the trading, the frozen accounts held approximately $1.4-million.
Freeze orders prevent a person from transferring assets, in order to increase the chances that funds will be available to pay any financial sanctions imposed by a BCSC panel.
“The BCSC issued a freeze order on accounts held at Haywood in 2019. The investment dealer was required to hold all funds, securities, exchange contracts and other relevant property on deposit control or safekeeping in the accounts under the freeze order,” the BCSC states in an announcement about the settlement agreement. In the agreement, it says Haywood circulated the order internally to compliance and investment advisors overseeing the accounts but still permitted the account holder to make six purchases and four transfers, resulting in the loss.
In addition to the $50,000 fine imposed by the BCSC, the firm has also voluntarily set aside its own funds to cover the losses.
