The brokerage arms of three of Canada's big banks will be at a regulatory hearing on Thursday, where a panel will be asked to approve a proposed settlement agreement over their alleged involvement in questionable market timing.
The Investment Dealers Association of Canada has accused RBC Dominion Securities Inc., TD Waterhouse (Canada) Inc. and BMO Nesbitt Burns Inc. of failing to detect and prevent market timing activities in mutual funds.
All three firms have reached a settlement with IDA staff that will be presented to an IDA panel for approval.
On the same day, an Investors Group Inc. subsidiary will appear at a separate settlement hearing before the trade group that polices mutual fund dealers.
The Mutual Fund Dealers Association of Canada has accused Investors Group Financial Services Inc. of permitting an institutional client to engage in market timing, which involves rapid, in-and-out trading in funds managed by its parent.
Meanwhile, sources close to the situation say they are puzzled that the Ontario Securities Commission has not yet issued its own notice of hearing. The commission is in settlement talks with four fund companies -- Investors Group, CI Fund Management Ltd., AGF Management Ltd. and AIC Ltd. -- that could see them pay $200-million in restitution to investors.
OSC enforcement director Michael Watson said he did not know whether settlements with the brokerages were conditional on a deal with the four fund companies.
© 2007 The Globe and Mail. All rights reserved.
Only GlobeinvestorGOLD combines the strength of powerful investing tools with the insight of The Globe and Mail.
Discover a wealth of investment information and and exclusive features.