The Investment Industry Regulatory Organization of Canada (IIROC) accepted a settlement agreement with former registered representative, Albert Ying Yuen Wong, fining Wong $10,000 and suspending him from any IIROC registration for two months, after a client complained about commissions, resulting in the discovery that Wong never obtained written authorization to carry out the client’s wishes, as directed.
In a settlement agreement with IIROC, Wong admitted that between January 2016 and August 2017 he engaged in discretionary trading in a client’s account with verbal consent, but without obtaining prior written authorization from the client, or approval from his firm.
“The respondent had general discussions with the client from time to time about trading in the client’s accounts but exercised discretion with respect to time, price, quantity and type of securities,” the settlement agreement states. It also says the client agreed Wong should make the trades necessary to meet the investment objectives of the accounts, “but that he did not want to be bothered with every single trade that the respondent made.” On several occasions prior to the period in question, the client was also made aware of the availability of a fee-based model, but declined, requesting to stay in a transactional account.
Despite this, and despite the fact that the client’s accounts gained 7.82 per overall during the period in question, gains were reduced by short-term trading that incurred realized losses, often due to the commissions charged. In August 2017 when the client became concerned about the volume of trading in his accounts and the commissions he was paying, Wong’s firm, Leede Jones Gable Inc., terminated the representative for the unapproved discretionary trading. It also settled with the client, compensating him for the commissions incurred.
The total assets of the three accounts managed by Wong were approximately $1.8-million. Between January 2016 and August 2017 the client paid approximately $142,000 in commissions.
In addition to the fine and two-month suspension, Wong must also successfully re-write the Conduct and Practices Handbook examination before applying for re-approval.
