Calgary registered representative, Wayne Frederick Workun, has been fined $40,000 by the Investment Industry Regulatory Organization of Canada (IIROC), and suspended for 60 days for managing his mother’s accounts in a manner that was not suitable for her. IIROC says he instead managed her accounts in a way that reflected the fact that Workun would share in her estate upon her passing.
According to the settlement agreement between Workun and IIROC staff, Workun’s mother, a retired widow, was in declining health with symptoms of dementia and did not consistently have the capacity to make financial decisions or understand investment recommendations.
During the period in question between November 2011 and December 2015, Workun pursued a high-risk investment strategy which involved highly concentrating his mother’s assets in oil, gas and mining companies, including speculative holdings in junior companies. The strategy had been used in his mother accounts in the past but had not been updated or altered as his mother’s life circumstances changed. The settlement agreement also states that Workun engaged in discretionary trading in his mother’s accounts without being authorized or approved to do so.
Over a four-year period, Workun’s mother’s accounts sustained a total net loss of $617,740 or 91 per cent of her portfolio. (During the same period, the S&P/TSX Composite Index increased by 6.6 per cent.) Despite having written instructions to limit high-risk investment to 10 per cent of her portfolio, during the period in question, her total portfolio contained a minimum concentration of 59 per cent and a maximum concentration of 99 per cent in mining and oil and gas sector securities. In addition, Workun also used various short-term, speculative options strategies, increasing the cost of investment and the associated risk level in the accounts.
Registered since 1985, Workun has worked in the Calgary branch of Leede Jones Gable Inc., since 2003. He was suspended from his branch manager position in October 2019. In addition to paying a fine of $40,000 (IIROC notes that the set fine would have been greater if it were not for Workun’s inability to pay), Workun is also suspended from acting as a branch manager for one year, must rewrite the Conduct and Practices Handbook and pay costs in the amount of $2,500.
