The Mutual Fund Dealers Association (MFDA) has fined Avtar Singh Badasha, a former Desjardins Financial Security branch manager and advisor in Vancouver, for using pre-signed forms, altering dates on documents, and for allowing an unlicensed person to open mutual fund accounts.
On June 9, the MFDA published its Reasons for Decision, which ordered Badasha to pay a $5,000 fine and $3,500 in costs, and that he be prohibited from conducting any securities related business for two years.
The MFDA found that while Badasha was branch manager, he allowed a life insurance advisor who was not securities licensed to complete account opening documents for herself and fifteen family members under his name, with the understanding that this advisor would eventually become licensed to sell mutual funds (she never did). Badasha did not meet with or speak to any of the individuals to verify the accuracy or appropriateness of the information collected.
The MFDA also found that he had:
- obtained, maintained and used approximately seven blank signed forms in the accounts of four clients;
- secured client signatures on account documentation for eight client accounts by sending only the signature pages to six clients; and
- changed the dates on two account forms that were faxed by one client.
All of the above was contrary to MFDA Rule 2.1.1.
Badasha was forced to sell his Desjardins franchise and had his branch manager status permanently revoked; Desjardins Financial Security terminated Badasha with cause last year as a result of the investigation.