A Kelowna portfolio manager was fined by the British Columbia Securities Commission (BCSC) for the second time in eight years.
Kilburn Oglivie Waymann Investment Management Ltd. (KOWIM) was ordered to pay $55,700 to the Commission for not managing business-associated risks and not providing reasonable assurance that complied with securities legislation. As part of the settlement agreement, the firm must also retain an independent compliance consultant for two years and submit its next two annual chief compliance officer reports to the BCSC.
During a compliance field examination in 2019, BCSC staff found the firm did not maintain records capable of generating certain account activity reports;made unsubstantiated marketing claims on its website about the benefits of investing through a portfolio manager; failed to ensure it was registered in each province where it had clients; paid client management fees it earned to an unregistered holding company; inaccurately calculated its excess working capital; and delivered deficient audited financial statements and a deficient auditor’s opinion to the BCSC as part of its mandatory filings.
The BCSC also found that the firm’s chief compliance officer also failed to adequately perform his duties.
Due to the significant compliance deficiencies, the firm failed to meet the registration requirements set by the Commission.
KOWIM has since admitted to the misconduct after receiving the examination report, according to the BCSC. There is no evidence that any clients were harmed despite the deficiencies, said the BCSC.
This is the second time the BCSC found deficiencies at KOWIM. The firm was ordered to pay $12,000 back in 2012 for failing to establish and maintain an adequate compliance system, as well as failing to maintain a minimum level of regulatory capital.
The BCSC is an independent provincial government agency responsible for regulating capital markets in B.C. It aims to protect and promote the public interest by fostering a securities market that is fair, along with a dynamic competitive securities industry that provides investment opportunities and access to capital.