The Toronto-based Mutual Fund Dealers Association of Canada (MFDA) has fined Daniel Lipovetsky, a former fund salesman in Ontario, a total of $80,000 for borrowing money from clients and failing to comply with an investigation.
Between 2007 and 2009, Lipovetsky borrowed a total of $20,000 from two clients ($10,000 each), according to MFDA documents. As a result, Lipovetsky created a potential conflict of interest with each client and failed to follow the MFDA’s policies and procedures prohibiting such activity. Lipovetsky has repaid the loans to both clients, according to the MFDA.
Furthermore, Lipovetsky did not attend a hearing panel in July despite being served a notice of hearing and therefore failed to cooperate with an MFDA investigation.
While the MFDA hearing panel stated in its reasons for decisions that the fact that Lipovetsky had repaid the loans might have meant a smaller fine, his refusal to cooperate with the investigation warranted a strong penalty.
In addition to the fine, Lipovetsky is also permanently banned from conducting any securities related business through an MFDA member. Lipovetsky must also pay $7,500 in costs.