A Hearing Panel of the Investment Industry Regulatory Organization of Canada (IIROC) has accepted a settlement agreement, with sanctions, between IIROC staff and Mary Louise Kasten-Brown.

In the settlement agreement, Ms. Kasten-Brown admits she failed her know-your-client and suitability obligations when she processed the opening of accounts and facilitated private share purchases for eight clients, without ensuring that the investment was suitable for them. The agreement includes the following penalty:

  • A $23,250 fine;
  • Disgorgement of $787.50;
  • $3,000 in costs;
  • To work under close supervision by her firm for a period of six months; and
  • Re-write the Conduct and Practices Handbook examination within six months.

Specifically, Ms. Kasten-Brown admits she:

  • failed to use due diligence to learn and remain informed of the essential facts relative to every customer to every order or account accepted, contrary to IDA Regulation 1300.1(a) (now IIROC Rule 1300.1 (a)); and
  • failed to use due diligence to ensure that the acceptance of any order from a customer is suitable for that customer, contrary to IDA Regulation 1300.1(p) (now IIROC Rule 1300.1 (p)).

IIROC began its investigation into Ms. Kasten-Brown’s conduct in February, 2008. The violations occurred in 2005 and 2006 while she was a Registered Representative with the Calgary branch of Octagon Capital Corp., an IIROC-regulated firm. She is currently registered at the Calgary branch of Global Maxfin Capital, Inc., an IIROC-regulated firm.