On November 1, 2012, a hearing panel of IIROC accepted a settlement agreement, with sanctions, between IIROC staff and Wellington West Capital Inc. (Wellington West) and Lesley Walters-Sagher.

Wellington West and Walters-Sagher admitted that they failed to adequately understand certain leveraged exchange traded funds and thus were not able to properly supervise trading in those funds.

Specifically, Wellington West and Walters-Sagher admitted to the following violations from January 2009 to June 2009:

(a) Each did not use due diligence to learn and remain informed of the essential facts relative to the orders for certain leveraged exchange traded funds accepted, contrary to Dealer Member Rule 1300.1(a); and
(b) They did not adequately supervise Wellington West Registered Representatives when they recommended certain leveraged exchange traded funds to their clients, contrary to Dealer Member Rule 2500.

Pursuant to the Settlement Agreement, Wellington West and Ms. Walters-Sagher agreed to the following penalties:

(a) Wellington West shall pay a fine of $175,000; and
(b) Walters-Sagher shall pay a fine of $15,000.

Wellington West also agreed to pay costs in the amount of $10,000.