Educational measure for investment specialist after code of conduct violation
On Jan. 14, 2025, DSI imposed an educational measure on a certified investment specialist. The measure was imposed for conducting a transaction where there was suspicion of market manipulation. In doing so, according to DSI, the certified person violated the DSI Code of Conduct.
What happened?
DSI’s investigation revealed that the certificant was instructed by a client to buy shares where there was talk of a higher price. After this, the certificant transferred the order to another institution that was handling the order execution. An employee of this institution then informed the client that the order was refused on the advice of compliance due to a suspicion of market manipulation. Following the other institution’s refusal to execute the order, the certified executed the order himself through his own employer’s system.
Why does this violate the code of conduct?
DSI believes that the specific request of the client combined with the negative compliance advice from the other institution should have been reason for the certified to exercise restraint. In this case, the certified should have first verified with his own compliance officer whether the order could be executed under these circumstances. By still directly executing the order himself, the certified acted carelessly.
What rules were violated?
According to DSI, this violated the DSI Code of Conduct. The following articles in particular are concerned:
- Article 7.1.2 and 7.1.3 – DSI Core Principle 3: Act carefully
- Articles 7.1.5 and 7.1.6 – DSI Core Principle 5: Comply with rules.
What measure was imposed?
DSI may impose sanctions if a violation of the Code of Conduct is found. This can be done by referring a case to the DSI Disciplinary Committee or by a transaction (settlement). DSI opted in this particular case for a transaction consisting of mandatory training. In considering imposing an educational measure on the certified person, DSI also took into account the labor law consequences that the incident had for the certified person.
