A former TD Bank branch manager has been fined $50,000 and ordered to pay the Canadian Investment Regulatory Organization (CIRO) $7,500 in costs associated with an investigation and hearing following an incident of sales misconduct.
Jennifer Beh was a mutual fund agent for TD Investment Services Inc. from April 2010 to October 2020, when she resigned from her branch manager duties after being reprimanded for improperly updating 27 customer contact preferences between November 2018 and January 2019. The updates were deemed “unusual activity” and a “serious breach” of the code of conduct, according to a letter from the bank to Beh.
It's unclear what direct harm, if any, came from the breach.
Although Beh departed TD Bank, investigators with the regulator pursued Beh in order to determine what happened. The matter may have turned out better for Beh had she cooperated, according to the panel’s decision issued on Dec. 13.
“Although [Beh] was aware of CIRO’s investigation, she failed to respond to reasonable requests for information or attend at an interview. [Beh’s] failure to cooperate ignored her duties and responsibilities as a formerly Approved Person and effectively thwarted CIRO’s ability to conduct an investigation,” the panel noted.
Beh failed to respond to most of the investigators’ inquiries by phone and email and service to her home address, the panel noted.
According to the decision, on Oct. 22, 2021, Beh told an investigator that she “did not recall making unwarranted changes to client contact preferences, that she no longer worked for TD Bank and that she would not be seeking re-registration in the securities industry in the near future.”
Thereafter Beh refused to be interviewed by the investigator, the panel found.
Much of the decision deals specifically with Beh’s refusal to cooperate.
“The Hearing Panel hopes that the significant fines imposed at this, and earlier hearings will serve to motivate Approved Persons and/or Members to participate in CIRO investigations. While it is not possible to predict what may have occurred had the Respondent cooperated with this investigation, had she done so an entirely different penalty may have been appropriate,” the panel stated following a hearing Beh did not attend.
Beh is now permanently barred from the securities industry.
The investigation against Beh was commenced by the Mutual Fund Dealers Association (MFDA) and at a time when CIRO had yet to absorb MFDA and the Investment Industry Regulatory Organization of Canada (IIROC) as one entity.
Last fiscal year, the organization issued $8.05 million in penalties and costs to individuals and collected 21 per cent of the fines, according to its 2023 enforcement report. It’s unclear what the collection rate is for former dealers, such as Beh.
In April 2018, the B.C. government amended the Securities Act to allow CIRO (MFDA and IIROC) to enforce penalties as court orders against investment dealers.
