The Investment Industry Regulatory Organization of Canada (IIROC) has fined Craig Hodge, a former Assante Capital Management branch manager and IPC Securities supervisor, a total of $85,000 for hiding outside trades from his firms and for offering to compensate a client for resulting losses.
Hodge was also banned from trading at IIROC firms for a year, was ordered to pay $5,000 in costs and will be subject to a 12-month period of strict supervision should he return to the industry.
In its decision, the hearing panel said Hodge knowingly continued to flaunt IIROC’s Rules for years, deceived member firms about his activities and robbed them of the ability to monitor him.
From January 2003 to November 2009, while a registered representative and branch manager at Assante, Hodge engaged in outside business activities without the knowledge or consent of his firm, effecting trades for a client – referred to as “EM” – with outside discount brokers. He continued to do so from December 2009 to April 2011, while a registered representative and supervisor at IPC Securities.
Hodge’s outside activities included options trading and short sales through discount brokers, activities which he was not licensed to do and which Assante did not permit. Hodges activities resulted in the loss of $430,000 for EM from January 2007 to April 2011, the panel said. He also offered to compensate EM in 2008, again in breach of IIROC rules.
The IIROC panel said the penalty was mitigated by Hodge’s cooperation with the panel, the fact that he admitted to the three charges, and because he had received no financial benefit from the activities.