Sco­tia­bank fund man­ager fined for lav­ish pro­mo­tional spend­ing

Edmonton Journal - - FINANCIAL POST -

Sco­tia­bank’s 1832 As­set Man­age­ment LP will pay a fine af­ter im­proper lav­ish spend­ing on pro­mo­tional ac­tiv­i­ties for fi­nan­cial ad­vis­ers.

Under a set­tle­ment agree­ment with the On­tario Se­cu­ri­ties Com­mis­sion, the firm will pay an $800,000 fine and an ad­di­tional $150,000 for costs re­lated to the reg­u­la­tor’s in­ves­ti­ga­tion.

In­vest­ment fund man­agers are pro­hib­ited from pro­vid­ing “ex­ces­sive non-mone­tary ben­e­fits” to ad­vis­ers. Pro­mo­tional ac­tiv­i­ties and items are sup­posed to be of min­i­mal value.

Ac­cord­ing to the set­tle­ment, the in­vest­ment firm, which is the man­ager of the Dy­namic fam­ily of mu­tual funds, failed to meet the min­i­mum stan­dards of con­duct from Novem­ber 2012 to Oc­to­ber 2017.

It pro­vided tick­ets to NHL games, con­certs and golf events. In­vest­ment con­fer­ence at­ten­dees were also gifted Ap­ple iPad minis, key­boards and sun­glasses as well as pricey food, drinks and en­ter­tain­ment.

The set­tle­ment noted that 1832 started to make changes last year to its in­ter­nal prac­tices aimed at im­prov­ing its com­pli­ance.

Glen Gow­land, Sco­tia­bank’s se­nior vice-pres­i­dent and head, as­set man­age­ment, said the bank takes its reg­u­la­tory re­spon­si­bil­i­ties se­ri­ously.

“We were fully co-op­er­a­tive with the OSC staff during the in­ves­ti­ga­tion.”

COLE BURSTON/BLOOMBERG

Sco­tia­bank’s 1832 As­set Man­age­ment LP Bank has been fined $800,000 by the On­tario Se­cu­ri­ties Com­mis­sion for breach­ing rules about ex­ces­sive pro­mo­tional spend­ing for fi­nan­cial ad­vis­ers.

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