Suspension upheld for advisor who sold off-book investments

The Ontario Superior Court has upheld the Ontario Securities Commission’s decision to suspend advisor Lucy Marie Pariak-Lukic for two years.

The securities commission decision, released this spring, suspended Pariak-Lukic from approval by, or registration with, IIROC in all categories anywhere in the industry for a period of two years. This suspension of registration was imposed in addition to the original sanctions imposed by the IIROC Hearing Panel.

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Pariak-Lukic has been registered with IIROC since 1994. She was working for yourCFO Advisory Group.

The Ontario Securities Commission found that in 2006 and 2007, she recommend and facilitated off-book investments for her clients without her employer’s knowledge or approval. She also failed to ensure a prospectus had been filed for the investments, or that the investments were exempt from prospectuses.

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The investments were in Lakepoint Mortgage Investment Fund, a private company that lent money to Trinity Diversified America, which invested in second mortgages on residential properties in the Toronto area. The only director and officer of Lakepoint was Pariak-Lukic’s husband, which she told her clients. Pariak-Lukic, her husband and her clients invested $3 million in Lakepoint, which was lost when Trinity went bankrupt, according to court filings.

Initially, IIROC fined her $50,000, put her under close employer supervision for six months, and ordered her to re-write the Canadian Securities Course within a year. The OSC reviewed the decision and added a two-year registration suspension this spring.

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The court reviewed the case, and on October 4, determined that the penalties were reasonable.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.