Justice scales and gavel by books

A former mutual fund rep who failed to disclose an impaired driving charge has been denied registration by the Ontario Securities Commission (OSC).

Following a hearing, the regulator refused to reactivate the registration of a fund rep — identified as AE in the decision — who failed to disclose a charge for impaired driving in 2023. AE was stopped by police driving 140 km/h in a 60 km/h zone and failed a series of breathalyzer tests.

According to the decision, the rep didn’t report the incident to their dealer at the time, and eight days later applied for a job at a different dealer — which also was not informed about the charge.

An application to the OSC filed in September 2023 to reactivate the registration did disclose the charge, which was ultimately dropped in 2024.

OSC staff opposed granting registration on the grounds that the rep “failed to provide true and complete disclosures on multiple occasions and provided a series of conflicting and unreasonable explanations for failing to provide true and complete disclosures.”

According to the decision, the rep admitted they should have disclosed the charge to both dealers, but didn’t “due to embarrassment and misunderstanding of the legal implications associated with the criminal charge.”

The regulator rejected the rep’s explanations. “The effectiveness of the registration process would be significantly diminished if applicants for registration could avoid disclosing detrimental information on the basis of unreasonable assumptions, forgetfulness, or misunderstandings,” the decision said.

As a result, the regulator denied the application for registration, but ruled AE could re-apply in future.

“I am of the view that AE is remorseful for their actions,” the decision said. The regulator added that AE may be able to demonstrate fitness for registration if sufficient time has passed, they can demonstrate the misconduct is unlikely to recur, and they produce independent evidence attesting to their suitability.