A former mutual fund rep who was disciplined by the Canadian Investment Regulatory Organization (CIRO) in 2024 has now also been sanctioned by the British Columbia Securities Commission (BCSC), in connection with the same misconduct.
In 2024, the self-regulatory organization (SRO) banned Lorne Stuart Allison, a former rep with Royal Mutual Funds Inc. and imposed monetary sanctions — including a $70,000 fine and $10,000 in costs — after finding that he violated multiple SRO rules by advising a handful of clients to open online brokerage accounts, and trading in those accounts on behalf of investors for a fee.
Last October, the executive director of the BCSC brought proceedings against Allison too, citing the findings of the CIRO panel in its decision against him.
Among other things, that decision found that Allison, who was registered between 2005 and 2021, engaged in securities-related business outside of this dealer. And, it said that even after he left the industry in 2021, he continued to trade in the investors’ discount brokerage accounts.
Now, the BCSC has imposed its own sanctions on him — permanently banning him from registration, and imposing a 10-year trading ban — saying in its decision that “Allison’s deliberate and deceptive misconduct was serious.”
“This seriousness was heightened by the position of trust that he held over his clients and the fact that a number of those clients were seniors,” the BCSC panel said, adding that he also disregarded his compliance obligations, undermined his dealer’s ability to supervise him and was an experienced registrant.
“Allison ought to have been aware of the registration requirements required for the sale of securities but, despite this knowledge, he convinced clients to move their investments away from [his dealer] and traded outside of what his registration permitted,” it said.
“The fact that this misconduct continued after he resigned from [his dealer] is indicative of his disregard for the regulatory safeguards put in place to protect the public and instill confidence in the markets,” the BCSC panel added. “Allison chose to flout the known requirements of his profession and this choice makes it clear that that it is in the public interest to impose restrictions on his participation in the markets.”
Allison didn’t participate in the BCSC’s proceedings against him.