A hearing panel of the New Self-Regulatory Organization of Canada (New SRO) published its reasons for fining Majid Hassanshahi $10,000 and ordering he pay costs in the amount of $5,000. In the New SRO’s documentation, Hassanshahi admits to processing trades without a client’s consent and to falsifying practice notes about the transactions.
Registered in the securities industry since 2011 and registered in British Columbia as a dealing representative with CIBC Securities Inc. since 2014, Hassanshahi violated CIBC’s policies and procedures requiring him to obtain a client’s explicit and prior approval for every transaction processed in a client’s account. Both transgressions – the trades and the falsified notes about them – were discovered after the firm received a complaint from the affected client.
In January 2020, the client in question opened an account with the firm, in February transferred assets to the firm, and they were invested in money market mutual funds within a newly created Tax-Free Savings Account (TFSA), according to the client’s instructions. When the funds were transferred successfully, without receiving instructions from the client, Hassanshahi then distributed the funds into four mutual funds and created a note that the client had instructed him to do so over the phone.
Following the client’s complaint, Hassanshahi admitted to processing the trades without authorization and the firm compensated the client for a $960 decrease in portfolio value.
“By processing the switch without first obtaining the client’s authorization, the respondent did not act fairly, honestly or in good faith. This was a serious contravention,” the New SRO’s reasons for decision document states. “Creating a false note to try to cover up the unauthorized switch was an even more serious contravention.”
They conclude by saying the $10,000 fine is an appropriate reflection of the seriousness of the case and area of misconduct. “The proposed costs of $5,000 are in line with hearing panel decisions referenced.”
