The Ontario District Council of the Investment Dealers Association of Canada has imposed discipline penalties on Lino D’Souza, a former registered representative with Nesbitt Burns, Inc.

In a settlement agreement reached with the IDA’s enforcement department, D’Souza acknowledged that he opened a brokerage account for a client in December 1993. Although the client was relatively unsophisticated, D’Souza initiated a trading strategy involving complicated options straddles.

D’Souza’s trades were unsuitable for the client, and confirmation of the trades took place after the fact. As well, D’Souza overstated the client’s net worth in the account opening documentation.

D’Souza opened an account for a relative of the client in April 1994. He allowed the client to assign the account opening papers of the relative who resided in Qatar. D’Souza purported to “witness” the signature of the relative. He also allowed the client to sign a power of attorney in favour of the client over the relative’s account, and purported to “witness” that signature, too.

D’Souza opened an account for a third individual in April 1994. Although the client was relatively unsophisticated, D’Souza again initiated a trading strategy involving complicated options straddles, and confirmed trades after the fact. He also changed the mailing address on this client’s statements, so that the statements were not delivered.

D’Souza opened an account for a fourth individual in August 1996. The client had mortgaged his condo in order to do so. D’Souza knew that the client needed income to meet monthly mortgage payments.

D’Souza once again overstated the client’s net worth in the account opening documentation. He again initiated a trading strategy involving complicated options straddles, and confirmed trades after the fact. As well, he changed the mailing address on this client’s statements, so that the statements were not delivered.

The IDA slapped D’Souza are a 10 year suspension and ordered him to pay $25,000 towards the cost of the investigation.