1. The Investment Industry Regulatory Organization of Canada (IIROC) will issue a notice of application to announce that a settlement hearing will be held before a Hearing Panel (the Hearing Panel) to consider whether, pursuant to Rule 8215 of IIROC's Enforcement, Examination and Approval Rules, it should accept a settlement agreement (the Settlement Agreement) between Staff of IIROC (Staff) and Michael Small (the Respondent). PART II - JOINT SETTLEMENT RECOMMENDATION 2. Staff and the Respondent jointly recommend that the Hearing Panel accept the Settlement Agreement in accordance with the terms set forth below. PART III - AGREED FACTS 3. For purposes of the Settlement Agreement, the Respondent agrees with the facts set out in Part III of this Settlement Agreement. Registration History 4. The Respondent has been a registered representative with IIROC as well as its predecessor, the Investment Dealers Association of Canada (IDA), since March 2008. SM FL Initial 2 / 5 Initial 5. From May 2015 to December 2019, the Respondent was employed and registered with National Bank Financial Inc. (NBF). 6. The Respondent has not been an IIROC registrant since December 2019. 7. The Respondent has no disciplinary history with IIROC. Particulars 8. On or around May 23, 2015, client A opened an account with NBF, through the Respondent. 9. Client A is an immediate family member of the Respondent and is a Related Person under the meaning of the Income Tax Act. 10. Since around April 25, 2015, the Respondent had acted as Power of Attorney for client A, under a general mandate to that effect. 11. The Respondent did not declare the situation to his employer, either when the account was opened or afterwards. 12. In no case was NBF informed in a timely manner, nor did it approve this arrangement between the Respondent and client A. 13. Moreover, the Respondent allegedly proceeded to borrow money from client A, between March and October 2019:  March 27, 2019 $2,000  April 24, 2019 $2,000  June 7, 2019 $1,300  October 18, 2019 $1,000 o Total : $6,300 14. The Respondent did not declare this situation to his employer. 15. Consequently, NBF was not informed in a timely manner nor did it approve these loans made to the Respondent by client A. SM FL Initial 3 / 5 Initial PART IV - CONTRAVENTIONS 16. By reason of the conduct described above, the Respondent contravened IIROC Dealer Member Rule 43: Count 1: Between March and October 2019, the Respondent had personal financial dealings with a client, who is also a Related Person as defined in the Income Tax Act, when he borrowed money from the latter without his employer's knowledge, contrary to Rule 43.2(3) of the IIROC Dealer Member Rules. Count 2: From May 2015 to December 2019, the Respondent acted as Power of Attorney for a client, who is also a Related Person as defined in the Income Tax Act, without his employer's knowledge, contrary to Rule 43.2(5) of the IIROC Dealer Member Rules.PART V - TERMS OF SETTLEMENT 17. The Respondent accepts the following penalties and costs: a) A fine in the amount of $20,000; b) The obligation to pass the Conduct and Practices Handbook (CPH) Course exam, in the event of re-registration; and c) Costs in the amount of $2,500 payable to IIROC. 18. If the Hearing Panel accepts this Settlement Agreement, the Respondent agrees to pay the amounts referred to above within 30 days of such acceptance, unless otherwise agreed between Staff and the Respondent. PART VI - STAFF COMMITMENT 19. If the Hearing Panel accepts the Settlement Agreement, Staff will not initiate any further action against the Respondent in relation to the facts set out in Part III and the contraventions in Part IV of this Settlement Agreement, subject to the provisions of the paragraph below. SM FL Initial 4 / 5 Initial 20. If the Hearing Panel accepts the Settlement Agreement and the Respondent does not abide by the terms thereof, Staff of IIROC may initiate proceedings against the Respondent pursuant to Rule 8200. These proceedings may be based on, but are not limited to, the facts set out in Part III of this Settlement Agreement. PART VII - SETTLEMENT ACCEPTANCE PROCEDURE 21. The Settlement Agreement is subject to acceptance by the Hearing Panel. 22. The Settlement Agreement shall be presented to a Hearing Panel at a settlement hearing held in accordance with the procedures described in Sections 8215 and 8428, in addition to any other procedures that may be agreed upon between the parties. 23. Staff and the Respondent agree that this Settlement Agreement will form all of the agreed facts that will be submitted at the settlement hearing, unless the parties agree that additional facts should be submitted at the settlement hearing. If the Respondent does not appear at the settlement hearing, Staff may disclose additional relevant facts, if requested by the Hearing Panel. 24. If the Hearing Panel accepts the Settlement Agreement, the Respondent agrees to waive all rights, under IIROC rules and any applicable legislation, to a disciplinary hearing, review or appeal. 25. If the Hearing Panel rejects the Settlement Agreement, Staff and the Respondent may enter into another settlement agreement; or Staff may proceed to a disciplinary hearing in relation to the same allegations or to related allegations. 26. The terms of this Settlement Agreement are confidential unless and until this Settlement Agreement has been accepted by the Hearing Panel. 27. The Settlement Agreement will become available to the public upon its acceptance by the Hearing Panel and IIROC will post a full copy of this Settlement Agreement on the IIROC website. IIROC will also publish a summary of the facts, contraventions, and the sanctions agreed upon in this Settlement Agreement. SM FL Initial 5 / 5 Initial 28. If this Settlement Agreement is accepted,the Respondent agrees that neither she nor anyone on her behalf will make a public statement inconsistent with this Settlement Agreement. 29. The Settlement Agreement shall become effective and binding upon the Respondent and Staff from the date of its acceptance by the Hearing Panel. PART VIII - SIGNATURE OF THE SETTLEMENT AGREEMENT 30. This Settlement Agreement may be signed in one or more counterparts which, together, will constitute a binding agreement. 31. The fax or electronic copy of any signature will be treated as an original signature. DATED this August 11, 2021. 

In your report you must explain:

2. The events and actions that led to this disciplinary process.
4. How the (alleged) offender should have acted/behaved in their particular situation to avoid the action being taken by IIROC.
6. Did any principals of conducts get violated?

Answer rating: 100% (QA)

Answer The disciplinary process initiated by the Investment Industry Regulatory Organization of Canada IIROC against Michael Small stemmed from his co... View the full answer