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Securities Commission Dismisses Pacific International Allegations

  • Date:

    2006-09-12

  • Number:

    2006/34

 

Vancouver - A British Columbia Securities Commission panel has dismissed allegations that Vancouver-based investment dealer Pacific International Securities Inc. and its directors contravened securities rules and acted contrary to the public interest.

 

Two of the three panel members concluded that, with minor exceptions, BCSC staff did not prove the allegations in a notice of hearing issued on July 10, 2001. One panel member, in a dissenting decision, concluded that the allegations were mainly proven.

 

The decision followed a hearing that lasted 124 days between early 2002 and late 2004, in which some 20,000 pages of evidence were presented. BCSC staff alleged in the hearing that Pacific International had contravened the know-your-client rule, failed to establish and apply written prudent business procedures and acted contrary to the public interest, and that the firm’s directors had breached their duties in failing to ensure that Pacific International complied. The allegations related to the U.S. dollar accounts of mainly foreign clients of Pacific International.

 

The majority of the panel - commissioners John Graf and Roy Wares - found that staff had failed to prove the allegations and failed to prove that the firm’s directors had not acted reasonably in responding to allegedly suspicious conduct. In her dissenting decision, Vice Chair Adrienne Salvail-Lopez found that Pacific International had contravened the know-your-client rule and failed to establish and apply written prudent business procedures for dealing with clients and that its directors had failed in their duties to ensure the firm was properly managed in compliance with these requirements.

 

A statement related to this decision from BCSC Chair Doug Hyndman is available here  PDF.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the decision on our website www.bcsc.bc.ca by typing in the search box, Pacific International Securities Inc. or 2006 BCSECCOM 532. If you have questions, contact Andrew Poon, Media Relations, 604-899-6880.