On Monday, the Ontario Securities Commission approved a settlement reached by staff of the commission and the Mark Kassirer.

Kassirer was the chairman of Phoenix Research and Trading Corp., investment counsel and portfolio management firm. He managed Phoenix Research’s equity arbitrage business.

The Phoenix Fixed Income Arbitrage Limited Partnership was a hedge fund managed by Phoenix Canada. PFIA LP collapsed in early January 2000 when Phoenix Canada discovered that one of its fixed income traders had accumulated a $3.3 billion U.S. long position in U.S. 6% treasury notes due August 15, 2009. The notes Notes were not hedged and caused a significant overdraft position at the Bank of New York. PFIA LP was forced to liquidate its assets. As a result, PFIA LP lost in excess of $120 million.

Last week, the OSC initiated proceedings against Ronald Mock, the firm’s CEO and president, and Stephen Duthie the portfolio manger responsible for the U.S dollar portion of the hedge fund.

OSC Staff alleged that Kassirer failed to monitor adequately, and provide appropriate general oversight of, the business of Phoenix Research including that related to the notes.

The commission reprimanded Kassirer and ordered that Kassirer Asset Management Corp., a registered investment counsel and portfolio manager of which Kassirer is the sole registered officer, submit to an independent review of its current controls and procedures and rectify any identified deficiencies.

Kassirer must also pass the Partners, Directors and Officers examination as a term and condition of his continued registration. As part of the settlement, Kassirer also paid $10,000 towards the cost of the investigation and hearing