The Ontario Securities Commission (OSC) will hear an appeal of a penalty handed down by a hearing panel of the Investment Industry Regulatory Organization of Canada (IIROC), from a former branch manager who argues that the sanctions imposed against him are too severe.
The OSC said Tuesday it will hold a hearing on Dec. 16 to hear an appeal of a penalty decision, that was handed down earlier this year, against a rep who admitted that, when he was a branch manager, he failed to properly supervise a rep in connection with the sale of inverse exchange-traded funds (ETFs).
Back in June, an IIROC hearing panel ordered that Bryan Vickers be suspended for six months, fined $30,000, and that he re-write the supervisor’s course before being re-approved as a branch manager.
According to the application for a review by the OSC, Vickers is seeking that the penalty be reduced to no suspension and a $15,000 fine (he doesn’t oppose the exam requirement).
Vickers and IIROC staff agreed to a statement of facts in the case, but not the penalty, which was imposed after a hearing. Now, the rep’s counsel argues that the panel made a number of errors in reaching its sanctions decision, including that the panel improperly considered a staff guidance note issued by IIROC on the suitability of leveraged and inverse ETFs, and the funds’ prospectuses — neither of which were addressed in the agreed statement of facts.
It also claims that the sanctions “are disproportionate to the conduct [which, it says] does not warrant any period of suspension and does not warrant a fine of $30,000.”
The application also claims that the panel failed to provide adequate reasons for its decision with respect to sanctions.