A former financial advisor in Winnipeg must pay $85,000 in fines to Investment Industry Regulatory Organization of Canada (IIROC) for failing to know his clients, engaging in unauthorized discretionary trading and conduct unbecoming.
Between 2006 and 2012, Sunday Opaleke, who was an advisor with Edward Jones, worked with three clients who were either retired or approaching retirement, had limited investment knowledge and wanted income from their investments. All three clients held margin accounts, and two of the clients also held RRSP and accounts. The clients were mostly invested in equity mutual funds. IIROC says such a strategy was too risky and aggressive a strategy for the clients’ given their goals and investment knowledge.
As a result, IIROC says Opaleke failed in his due diligence to know his clients and made unsuitable investment recommendations. Furthermore, IIROC found that Opaleke made discretionary trades in all three accounts without approval.
In the case of a fourth client, in addition to executing unauthorized trades, Opaleke guaranteed in writing to compensate her for any losses in her TFSA. IIROC deemed this personal guarantee to be conduct unbecoming as Opaleke made the promise without the knowledge or approval of his firm.
In addition to the fine, Opaleke was also ordered to pay $10,000 in costs and is suspended from IIROC registration for one year.
Opaleke is no longer a registrant with an IIROC- regulated firm.