A hearing to consider the Investment Industry Regulatory Organization of Canada’s (IIROC) appeal for tougher sanctions against a rep will be held early next year by the Ontario Securities Commission (OSC).

The OSC said Thursday that it will hold a hearing on January 15, 2015 to consider a request from IIROC for a review of a couple of decisions that were handed down by an IIROC hearing panel earlier this year. IIROC is seeking a review of the sanctions handed down against a rep, Lucy Marie Pariak-Lukic, after a hearing panel found that she violated IIROC rules by recommending off-book investments to clients without properly determining whether the securities were exempt from prospectus requirements. (See IIROC staff seek review of two hearing panel decisions, www.investmentexecutive.com, June 10, 2014.)

The hearing panel found that her conduct was not in the public interest; and, after a penalty hearing, it fined her $50,000; ordered that she pay $45,000 in costs; and that she retake a couple of courses and be subject to close supervision for six months. However, the panel ruled that the two-year suspension sought by IIROC was not warranted.

IIROC is now seeking to appeal that decision. In its application for a review, IIROC asks that the commission either impose the two-year ban that it originally sought, or that it return the question of the appropriate penalty to the hearing panel for a second look after the commission reviews the decisions in the case.

Among other things, IIROC argues that the hearing panel made an error by not imposing a suspension because it did not give enough weight to the principle of deterrence; that it overlooked evidence; and, that it was wrong to conclude that she didn’t benefit from the violations. It also suggests that the panel put too much weight on the “trauma” suffered by Pariak-Lukic due to the proceeding against her. IIROC also argues that the decision is inconsistent with the public interest, and that it is inconsistent with the approach of the OSC and other regulators in cases involving illegal distributions.