Market Regulation Services Inc.

Market Regulation Services Inc.

February 28, 2007 15:04 ET

Marc McQuillen Agrees to Settlement with Market Regulation Services Inc.

TORONTO, ONTARIO--(CCNMatthews - Feb. 28, 2007) - A Hearing Panel in Toronto today approved a settlement agreement between Market Regulation Services Inc. (RS) and Marc McQuillen ("McQuillen"). In the settlement, McQuillen agrees that he engaged in conduct which resulted in Scotia Capital Inc. contravening UMIR 7.7(5) (pre-May 2005 version) and UMIR 6.4 between June 3, 2004 and April 18, 2005, for which he is liable pursuant to UMIR 10.3(4).

During the period April 4, 2002 to April 18, 2005, David Berry, then Head of Preferred Trading at Scotia Capital and his assistant on the Preferred Desk, Marc McQuillen, operated outside of the normal syndication practices in relation to new issues for which Scotia was a member of the underwriting syndicate. They solicited client buy orders from their clients during the distribution period at the distribution price. Then, on or about the first day of trading, they conducted off-marketplace trades in the newly listed shares by selling them to clients, largely from a short position, from their inventory account. These short positions were subsequently covered in the market, usually at a profit. Marc McQuillen was fined $25,000.

"This settlement is a reminder that all traders, whatever their level within the firm, must operate within recognized syndicate practices," said Maureen Jensen, Vice-President Market Regulation, Eastern Region. "Bypassing the syndicate through these types of solicitations and off-marketplace trades created a lack of transparency in the market and clearly violated the principle of market integrity."

Details of the settlement can be found on RS's website at www.rs.ca.

About Market Regulation Services Inc. (RS)

RS is the independent regulation services provider for Canadian equity marketplaces, including TSX, TSX Venture Exchange, CNQ, Bloomberg Tradebook Canada Company, Liquidnet Canada Inc., Market Securities Inc., Shorcan ATS Limited and Pure Trading. RS is recognized by the securities commissions of British Columbia, Alberta, Manitoba, Ontario, and the Autorite des marches financiers in Quebec to regulate the trading of securities on these marketplaces by participant firms and their trading and sales staff. RS helps protect investors and ensure market integrity by ensuring all equities transactions are executed properly, fairly and in compliance with trading rules.

Contact Information

  • Market Regulation Services Inc.
    Melissa MacKewn
    Acting Chief Enforcement Counsel, Eastern Region
    416-646-7229
    416-646-7285 (FAX)
    melissa.mackewn@rs.ca