Victory for Lavery’s client, the Chambre de la sécurité financière, before the Superior Court

Raymond Doray Loïc Berdnikoff In a decision rendered on May 4, 2015 (2015 QCCS 1890), the Superior Court of Quebec confirmed the prerogative of the syndic of the Chambre de la sécurité financière (CSF), in demanding and obtaining the information it deems necessary in order to investigate the activities of Mutual Fund Dealer Representatives (MFDR) registered with a bank’s brokerage subsidiary. Mr. Raymond Doray, Ad. E., and Mr. Loïc Berdnikoff, Administrative Law partners at Lavery, argued the case for the CSF.

According to justice Louis Lacoursière, the Act respecting the Distribution of Financial Products and Services (ADFPS) allows the CSF’s syndic to obtain documents and information from anyone in the course of an investigation, without regard to the fact that this person is a bank whose employees work part-time as MFDR. That applies, all the more so, when the bank, not its brokerage subsidiary, is in sole possession of the documents and information.

Furthermore, the Court found that when circumstances where the integrity, honor and dignity of the bank’s MFDR are concerned, the syndic has the right to have produced confidential documents and information, even if they’re related to core banking activities, as opposed to activities regarding collective investment.

The CSF’s role of protecting the public requires, according to the tribunal, a flexible interpretation of the syndic’s powers under the ADFPS.

This represents an important victory for the self-regulation of an industry which has many important Lavery clients.

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Raymond Doray

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Loïc Berdnikoff

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