Hearing panel fines $60,000, imposes six-month ban, and requires training for future approval
The Canadian Investment Regulatory Organization (CIRO) sanctioned Jason Beales following a settlement hearing held on November 25, under the Investment Dealer and Partially Consolidated Rules.
A hearing panel determined that Beales disclosed potentially confidential information to several hedge fund clients.
Beales, previously a Registered Representative and Managing Director of Sales at the Toronto branch of Stifel Nicolaus Canada Inc., disclosed details regarding a block trade transaction in April 2020.
These disclosures involved shares of a publicly listed issuer, referred to as Issuer 1.
One hedge fund client executed short sale transactions using this information, which resulted in a potential profit of $97,218. The panel noted that Beales was unaware of the client's short sales.
The sanctions against Beales include a $60,000 fine, a six-month prohibition from approval in any capacity with CIRO, and a requirement to complete the Conduct and Practices Handbook Course before regaining approval.
Additionally, Beales must pay $5,000 in costs. The panel emphasized the need for sanctions to deter future misconduct and uphold market integrity.
This case is linked to earlier settlements involving the same transaction. In Re Stifel Nicolaus Canada Inc., a $475,000 fine was issued to the firm for supervisory failures.
Similarly, Re Weir involved another senior employee's disclosure, resulting in a $75,000 fine.
Beales, who was employed at Stifel from December 2019 to July 2022, no longer holds any registration in the securities industry.
The panel concluded that the settlement agreement was in the public interest, citing mitigating factors such as Beales’ lack of prior disciplinary record and his cooperation in the investigation.
