Advisor ban upheld by Supreme Court

Advisor ban upheld by Supreme Court

Advisor ban upheld by Supreme Court

The Supreme Court is standing with a provincial securities regulator on the controversial banning of an advisor.

A court ruling indicates that when the BCSC imposed a ban upon advisor Patricia McLean in 2010, it acted appropriately. This came after the Ontario Securities Commission (OSC) levied its own ban on McLean.

McLean, however, has vehemently opposed the decision, stating that the events leading up to the ban occurred three years ago, and therefore were not applicable to a six-year limitation period set out in the B.C. Securities Act. 

However, the court has now upheld that ruling, bolstering the BCSC’s assertion that the limitation period began once the Ontario proceedings took effect instead of at the time the issue occurred. This, said the court, was “a reasonable (decision) because it furthers the legislature’s manifest goal of improving interprovincial cooperation (amongst securities regulators).”

Lawyer Chris Wirth, who represented McLean, said that the decision was monumental for the investment industry, as it provides tribunals with additional leeway when dealing with these kinds of problems.

This is not the first time that McLean has found herself involved in a securities-related imbroglio. In July 2005, the former advisor with Rampart Securities Inc. came under fire after she was discovered to have several private placements within Hucamp Mines Ltd. in 2000 and 2001. She would later reach a settlement with the OSC in 2008.

McLean’s 2008 settlement led to an enforcement proceeding with the BCSC in January 2010, based on the sanctions she agreed to with the OSC. She fought the ruling, and argued that the six-year limitation should have been applied to the original date that the events occurred on.

The BCSC’s lawyers, however, stated that the six-year period would nullify the purpose of the legislation, which permits a commission to obtain a protective order based on orders put forth by another commission.

“Persons who agree to market prohibitions in Ontario should know they may be similarly prohibited from participating in those activities in other provinces,” wrote the BCSC’s legal team in their legal brief.