Representative fined $125,000 and banned for accepting power of attorney

The Canadian Investment Regulatory Organization (CIRO) has thrown veteran advisor, Ann Marie Reid, out of the industry permanently, and assessed a fine in the amount of $125,000. The sanctions follow after a hearing panel found that she accepted a power of attorney for property from a client along with an appointment as executor and trustee of that client’s estate without disclosing the conflict to the firms she worked for.

Deception was an aggravating factor 

“An approved person accepting a financial interest in a client’s estate (Reid was also named as a beneficiary in the client’s estate), is totally inconsistent with the trusted position that a mutual fund advisor holds. It clearly and unambiguously prevents the approved person from being able to fulfill his or her role as an independent and impartial advisor, influenced only by the best interests of the client,” the decision states. “The respondent deceived her member into believing that any conflict between her and client MW had been fully and appropriately addressed, when, to her knowledge, it had not. This deception is a further serious aggravating factor with respect to penalty.” 

The Toronto and Mississauga, Ontario-area representative was first registered in the securities industry in May 1997. “She had considerable experience in the industry, including in a supervisory capacity. She should have known that her conduct was wrong and unacceptable,” the decision adds.

The decision later states that had Reid taken any steps to be removed as the client’s executor, and provided evidence of the same, that this would’ve been considered a mitigating factor.

Misconduct spanned multiple years 

“The respondent has caused damage to the integrity of the capital markets. Her misconduct spanned multiple years, encompassed numerous contraventions of Mutual Fund Dealers Association of Canada (MFDA – CIRO’s predecessor organization) rules, took place while she was registered with two members, involved significant conflicts of interest which she failed to disclose to the members and purposely mislead members on the compliance forms which she did submit.” 

In addition, the representative is being sanctioned for borrowing $30,000 from another client altogether and for obtaining and possessing 18 pre-signed forms for 7 different clients. On top of the fine and prohibition from conducting securities-related business with any CIRO member firm, Reid was ordered to pay $20,000 in costs.