Another KYC meltdown

Another KYC meltdown

Another KYC meltdown Shoddy paperwork leads MFDA to lay big fine against former advisor
 
Mutual Fund Dealers Association of Canada (MFDA) fines former WFG Securities of Canada advisor Toula Adeola $250,000 as well as $10,000 in costs for several infractions between December 2007 and July 2008 at the Mississauga, Ontario, branch of WFG.
 
More importantly, Adeola’s been banned for life from conducting securities-related business with any MFDA firm.  
 
The crux of the matter has to do with the original KYC documentation Adeola filled out for new clients. Items such as RRSPs, residences, income, and other things of a monetary nature were either inflated in value or simply didn’t exist.
 
In addition, the advisor exaggerated clients’ investment knowledge and risk tolerance, many of whom were new to Canada and trusted the advisor.
 
Worse still, Adeola sold clients on a leveraged investment strategy that wouldn’t decrease in value or result in any out-of-pocket expenses. The strategy backfired; by 2010, some clients were unable to keep up with the monthly payments.
 
A year later one of the client’s went to the MFDA leading to this ruling.