A settlement hearing in the matter of Sentinel Financial Management Corp. was held Thursday in Saskatoon, Saskatchewan before a hearing panel of the MFDA’s Prairie Regional Council.

The hearing panel accepted the settlement agreement between MFDA staff and the respondent, as a consequence of which:

1) the respondent has paid a fine in the amount of $35,000, pursuant to s. 24.1.2(b) of MFDA By-law No. 1;

2) the respondent has paid costs in the amount $2,500, pursuant to s. 24.2 of MFDA By-law No. 1.

In the settlement agreement, the respondent admitted that it failed to establish, implement and maintain adequate policies and procedures to fulfill its obligations to:

(a) conduct proper two tier trade supervision on a daily basis to:

i) ensure that each order accepted and each recommendation made for any account of a client is suitable for the client and in keeping with that client’s investment objectives;
ii) ensure that sales of exempt securities were made in accordance with applicable exemptions and other regulatory requirements; and
iii) ensure that the handling of the respondent’s business was in accordance with the by-laws, rules and policies of the MFDA and applicable securities legislation; and

(b) maintain adequate records of trade supervision undertaken including inquiries made, responses received and resolutions achieved following supervisory inquiries; contrary to MFDA Rules 2.2.1 and 2.5.1, former MFDA Rule 2.5.4 (now MFDA Rule 2.5.7) and MFDA Policy No. 2.

The hearing panel advised that it will issue written reasons for its decision in due course. Read a copy of the Settlement Agreement.