A hearing panel of the Investment Industry Regulatory Organization of Canada has fined a Montreal broker $50,000 for engaging in unauthorized, excessive and discretionary trading for the purpose of generating commissions.
The panel accepted a settlement agreement, with sanctions, between IIROC staff and Nicholas Jason Budnik.
The violations occurred between 2003 and 2006, while Budnik was a registered representative at the Montreal branch of Canaccord Capital Corp., now Canaccord Genuity Corp.
In the settlement agreement, Budnik admitted that he:
- engaged in unauthorized discretionary trading in a client’s accounts, even though the accounts had not been approved as discretionary accounts by his firm; and
- engaged in excessive trading for the purpose of generating commissions, without regard to the client’s investment objectives.
The penalty against Budnik includes a $50,000 fine, disgorgement of $77,000 in profits, and a three-month suspension from registration with IIROC in any capacity. Budnik has also agreed to pay $3,000 in costs.
Budnik is required to re-write the Conduct and Practices Handbook examination within 12 months of the settlement being accepted. In addition, upon being re-registered with IIROC, he would be subject to strict supervision for 18 months, followed by close supervision for an additional six months.
IIROC began the investigation into Budnik’s conduct in June 2009. He is no longer registered with an IIROC-regulated firm.