Manulife Securities to pay $11.7 million in no-contest settlement with OSCBy The IJ Staff | July 14 2017 09:45AM
The Ontario Securities Commission approved a no-contest settlement agreement with Manulife Securities and Manulife Securities Investment Services (the Manulife dealers) on July 13.
OSC Staff alleged there were inadequacies in the Manulife dealers’ systems of control and supervision. This led to certain clients paying excess fees that had not been detected and corrected in a timely manner. The Manulife dealers discovered and reported the matter to the OSC themselves. OSC Staff found no evidence of dishonest conduct by the Manulife dealers, stated the regulator in an announcement.
Did not confirm nor deny
While the Manulife dealers did not confirm nor deny the accuracy of the OSC’s findings, they agreed to compensate clients $11,700,000 in fees and opportunity costs on fees.
"Regular vigilance is required to safeguard client accounts from errors and inattention," said Jeff Kehoe, director of enforcement at the OSC. "Clients have the right to expect robust compliance systems and controls to protect against excess fees."
Paid costs to advance regulator’s mandate
The Manulife dealers also paid $495,000 to the OSC “to advance the OSC’s mandate of protecting investors” and $25,000 to the OSC to go towards the costs of the investigation.
The OSC noted that the dealers provided “prompt, detailed and candid co-operation to OSC Staff” and “have implemented additional controls and supervision to prevent a re-occurrence of this matter.”