Misappropriation leads to $100,000 fine and permanent ban

A hearing panel of the Canadian Investment Regulatory Organization (CIRO) has published its decision and reasons for fining Dejan Ristovski $100,000 and throwing Ristovski out of the industry permanently after the dealing representative, also a bank employee at the time, borrowed from a client before opening multiple accounts in the client’s name for his own use.

The hearing panel found that Ristovski misappropriated funds and engaged in personal financial dealings with a client which gave rise to a conflict of interest that he did not address or disclose. The hearing panel also determined that Ristovski failed to cooperate with the regulator’s investigation.

In addition to the ban and fine, the former dealing representative was also assessed investigation costs in the amount of $11,000. 

Ristovski was registered in Alberta as a dealing representative between June 2011 and March 2021 when he was terminated by CIBC Securities Inc.  

When one of his clients, identified as TM in the decision documents, reported that she’d received an email indicating that a line of credit account at the bank in her name had an overdue payment outstanding, the bank launched an investigation which revealed that her name had been used to create a line of credit (LOC), a debit card for the LOC, a checking account and a Visa card.

“The bank interviewed the respondent on March 2nd, 2021 and he generally admitted to opening the bank products fraudulently,” the decision states. “The bank investigation also indicated that the respondent supplied his own home address on the bank products in order to avoid detection of the scheme. He also admitted during the bank interview to using this tactic.” 

Between August 2017 and February 2021 he withdrew $29,300.25, repaying $24,669.30 to keep the LOC from going into default. When it was closed by the bank, the LOC had a balance of $8,226.92 left owing. Similarly, the credit card had a balance of $508 when it was cancelled. As for the bank account, Ristovski reportedly made $9,500 in overdraft withdrawals, but made deposits of $10,810 during the same time period, as well.

During the bank’s investigation, it was also noted that Ristovski transferred $10,925 to TM. When asked about the transactions, he admitted to borrowing money from the client, despite knowing that this was prohibited.

Ristovski did not participate in the hearing regarding his conduct.