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by Mike Caswell

Canaccord Genuity Corp. is a defendant in another action arising from a risky options program run by two of its former Kelowna advisers that collapsed in 2008. A group of investors has filed a lawsuit against the firm in the Supreme Court of British Columbia complaining that the options program was entirely unsuited to them. Although supposedly protected by something called "dynamite insurance," the investors suffered catastrophic losses in the 2008 downturn, the suit states. The investors are seeking damages for negligence and breach of duty, among other things.

For Canaccord and its two former Kelowna employees, the lawsuit comes months after the conclusion of substantial regulatory actions over the options program. On May 22, 2014, the Investment Industry Regulatory Organization of Canada imposed three-year bans and $100,000 fines on each of the two advisers responsible for the program, Traian Moldovan and Robert Holmes. In imposing the sanctions, IIROC cited the disastrous results of the options program. Mr. Moldovan and Mr. Holmes had lost most of the $8.8-million invested with them, much of which came from retirees.

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