CORNWALL – A Cornwall financial advisor has been fined $6,000 as part of a settlement with the regulatory body that oversees mutual funds in Canada.
Benjamin Stewart also has to pay $2,500 in legal costs for a total monetary penalty of $8,500.
He’s also suspended from acting as a branch manager or in a supervisory capacity for two months and has to complete a branch manager’s course. He’s not allowed to act as a branch manager until the course is completed.
In a virtual hearing in Toronto last week, a three-member panel heard how Stewart completed two account forms in early 2019 without telling the client about them, signed the client’s signature on the forms and then submitted them for processing.
Outlined in an agreed statement of facts, Stewart had met with the client on Jan. 9, 2019, known in the settlement agreement as “SH,” about transferring their RRSP and TFSA accounts between Royal Mutual Funds and the Royal Bank in order to have their money in cash or a GIC inside the RRSP or TFSA. The transfer paperwork had been completed during that meeting.
Stewart had been out of the office for the birth of his child Jan. 14-18, and during that time there was a processing delay due to a required form. He then signed two mutual fund reclassification forms on Jan. 22, requested by the bank, in order “to process the transactions without any further delay” after the client complained about the delay.
The unauthorized signing was discovered Jan. 25 after the client made another inquiry at the bank about the transfer delay and said they didn’t sign those forms.
“There is no evidence that the Respondent (Stewart) received any financial benefit from the conduct. There is evidence client SH authorized the underlying transactions,” the decision reads in part.
“The Respondent recognizes that he ought to have contacted the client in order to complete the forms and obtained the client signature,” the panel wrote in the March 10 decision.
Stewart is a personal financial planner (PFP) with the Royal Bank of Canada in Cornwall and has been in that position since April 2017, according to his LinkedIn account.
The fines were payable on the date of the decision on March 10, 2021 and the two month supervisory suspension took effect on the same day.
The Mutual Fund Dealers Association of Canada penalty last week wasn’t the only one. The decision shows Stewart was also given a written warning by Royal Mutual Funds Inc. in March 2019 and put on heightened supervision. He was also penalized $8,250 through reduced pay.