Stock broker penalty reduced to warning after delayed proceedings, corrective action, and comparative proportionality review.

Stock broker regulatory violations were proved, but the Tribunal held that suspension for four months was excessive because the inspection related to an earlier period, the enquiry and show-cause process were substantially delayed, comparable cases had attracted only warnings or lesser measures, and the broker had taken corrective steps. It further noted that the sanction should not cripple the broker's business where a minor penalty would meet the regulatory purpose. The suspension was therefore set aside and replaced with a strong warning as the appropriate penalty under the penalty regulations.

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Issues: Whether the suspension of the stock broker's registration for four months was warranted for the proved regulatory violations, or whether the penalty should be reduced to a minor penalty by way of warning.

Analysis: The broker was found to have violated the stock broker regulatory requirements, but the Tribunal noted that the inspection related to an earlier period, the enquiry and show-cause process were substantially delayed, and comparable cases had attracted only warnings or other lesser measures. The Tribunal also took into account the broker's subsequent corrective steps and the need to avoid crippling its business. In these circumstances, the suspension was considered excessive and a minor penalty under the penalty regulations was held to be appropriate.

Conclusion: The suspension was set aside and replaced with a strong warning, which was the lesser penalty considered appropriate in the circumstances.

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