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Globe says OSC fines Questrade $3-million over ETF sale

2018-11-28 09:17 ET - In the News

The Globe and Mail reports in its Wednesday edition that Questrade Wealth Management has agreed to pay $3-million in fines after investment regulators found the company failed to shield clients from a possible conflict of interest following the sale of its ETF business to WisdomTree Investments. The Globe's Clare O'Hara writes that in a settlement agreement reached Tuesday, Questrade Wealth agreed to pay a $2.9-million administrative penalty and $100,000 in costs to the Ontario Securities Commission after voicing concerns surrounding its robo-adviser business Questwealth Portfolios, which recently changed its name from Portfolio IQ. Last week, the OSC alleged that Questrade did not have proper compliance measures in place to ensure that client portfolios were not at risk after its portfolio subadviser invested $15-million in WisdomTree funds. This was immediately after Questrade sold its exchange-traded funds business to WisdomTree. With the change of ownership of the ETFs, the OSC was concerned the investments may not have been suitable for clients because there was no documentation. Also, Questrade has hired an independent consultant to review the appropriateness of WisdomTree ETFs for the model portfolios.

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