A hearing panel of the Mutual Fund Dealers Association of Canada (MFDA) has imposed sanctions against Saskatoon, Sask.-based Sentinel Financial Management Corp. for supervisory failures, the MFDA announced Wednesday.
The MFDA panel approved the settlement and imposed a $75,000 fine and $10,000 in costs.
According to the settlement agreement dated Aug.9, MFDA staff, during a 2016 compliance exam, “identified deficiencies in [Sentinel’s] due diligence with respect to exempt market products.”
In the settlement agreement, Sentinel admitted it violated MFDA rules by not providing adequate trade supervision between July 2012 and July 2016, including failing to ensure that clients’ trading in the exempt market was suitable.
The mutual fund dealer also admitted it didn’t properly oversee a couple of reps that were supposed to be under close supervision.
As additional factors, the settlement stated that Sentinel ceased selling exempt market products in 2016, has hired a new chief compliance officer, and has agreed to conditions set on its registration by the Financial and Consumer Affairs Authority of Saskatchewan in connection with similar supervisory concerns.