A hearing panel of the Investment Dealers Association of Canada has imposed discipline penalties on Steven James Westman.

Westman was an Approved Person with the Winnipeg branch of Merrill Lynch Canada Inc.

In an agreed statement of facts, Westman admitted that between May 1999 and March 2001, made unsuitable recommendations for two clients. He also admitted that between February and March 2001, he failed to adequately inform himself as to the nature or details of two income trusts that he had recommended.

The IDA first learned of these matters in July 2005 through a ComSet filing.

For his misconduct, the panel ordered Westman to pay a fine of $20,000, and rewrite and pass the examination based on the Conduct and Practices Handbook within one year of being re-approved for employment at any IDA Member firm.

As well, the panel imposed strict supervision for a period of one year upon Westman’s reapproval.

Westman must also pay costs in the amount of $18,000 and is prohibited from being reapproved until the ordered fine and costs are paid.

One of the two clients was established to purchase land for certain First Nations of Manitoba to fulfill land treaty entitlement obligations of the governments of Canada and Manitoba. A corporate trustee had been appointed to manage that client’s accounts and investments were to be made in accordance with a “Framework Agreement”. The other client was a trust established to receive government funds for an Aboriginal group. Investments in that account were similarly to be made in accordance with a concluded agreement. Some of the investments recommended by Westman were not suitable for these two clients and did not conform with the agreements.

In determining penalty, the panel considered the following mitigating factors:

> the clients suffered no losses;

> the two clients were relatively sophisticated and they, the corporate trustee, and the Merrill Lynch must assume some of the responsibility for the investments not complying with the governing agreements;

> one of the unsuitable recommendations was suggested to Westman by his manager;

> Westman has no prior disciplinary record, and he fully cooperated with the IDA investigation.

Westman is currently not employed with an IDA firm.