An Investment Industry Regulatory Organization of Canada (IIROC) hearing panel has approved a settlement agreement between IIROC staff and Richard Poirier, a former rep Desjardins Securities Inc., ruling that the fact he lost his job represents a significant mitigating factor in determining the penalty against him.

Poirier admitted to violating IIROC rules by facilitating an off-book transaction without the knowledge of his dealer and accepting a $150,000 “gift” from the client. Under the settlement, he agreed to pay $100,000 and to be suspended for one month. If Poirier ever rejoins the industry, he’d also be subject to 12 months of close supervision.

In approving the proposed settlement, the IIROC hearing panel noted that the violations are “egregious.” As a result, “the sanctions provided in the settlement agreement reached by the parties appear inadequate, at first glance.”

However, the IIROC hearing panel set out several mitigating factors that, it believes, justifies sanctions that include a financial penalty that’s less than the benefit generated by misconduct. Most important is the fact the firm imposed “the ultimate sanction” on him by ending his employment. Furthermore, the settlement notes that Poirier has been unable to find employment in the industry since he was dismissed in March 2015.

The other mitigating factors the IIROC hearing panel cited include the fact that there was only one instance of misconduct involving one client; the client, who was experienced, wasn’t harmed and didn’t complain; Poirier had no prior disciplinary history; and Poirier demonstrated that he is unable to pay more than $100,000. In addition, he admitted the misconduct and didn’t try to cover it up.

Ultimately, the IIROC hearing panel ruled that although the sanctions are on the low end of an acceptable range, “they are not unreasonable,” particularly given that “he has been unable to find employment in the industry and is experiencing substantial financial hardship as a result.”

The IIROC hearing panel notes that it can only approve, or reject, a proposed settlement. It cannot alter it, or impose different sanctions.

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