Regulators have ordered Montreal’s Maxima Capital to cease all dealings with clients.

During a hearing held yesterday, the Commission des valeurs mobilières du Québec rejected a request made by Maxima Capital for additional time to comply with an earlier agreement between the firm and the CVMQ. The CVMQ is suspending the firm’s registration for 30 days. At the end of this suspension period, the dealer’s registration will automatically be revoked.

The suspension arises from a CVMQ decision back on Dec. 8, 2000, which suspended three of Maxima Capital’s officers, ordering them to reduce their voting share ownership within 90 days. Over the past weeks, the CVMQ granted additional time to enable the officers to respect the agreement. But they failed to reduce their share ownership and following the dismissal of Maxima Capital’s request to obtain an extended delay, the CVMQ suspended the firm.

As a result of the decision, and considering the lack of regulatory capital of the firm, the Special Committee – Regulatory Division of Bourse de Montréal Inc. has also suspended the firm and the registration of its registered representatives, effective immediately.

The Quebec District Council of the Investment Dealers Association has also suspended the rights and privileges of Maxima Capital, effective immediately and until further notice. It has directed Maxima to immediately cease dealing with the public. The IDA says another bulletin will be issued and the clients notified of any developments.