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Mutual Funds and Scholarship Plans

Files To Keep

Although in theory obligations for record keeping apply to brokerages, many client files are first created by the representative because he is in direct contact with the clients. As applicable, therefore, he must adhere to the rules established by the brokerage for which he works and provide the relevant information.

Below are files that the brokerage must keep that involve the representative:

  • Files on his relationships with clients

    It should be noted that in terms of files on relationships with clients, all brokerages must have a complaint policy and keep a record of complaints as well as a file for each complaint received. The Autorité’s website provides further information on this topic.

  • Files on client transactions
  • Files required under the Proceeds of Crime (Money Laundering) and Terrorist Financing Regulations

For more information on the compliance program and the files to keep under this law, see the section Fighting money laundering.

Content of files to keep

The brokerage must keep files that allow easy verification of the following information and documents:

  • Account opening form
  • Investor profile determination form
  • Disclosure form for leveraged loans, if applicable
  • Copy of the written disclosure of any client referral agreement
  • Power of attorney or mandate, if applicable
  • Limited transaction authorization form, if applicable
  • Information on any change in the client’s situation
  • Margin account agreements and other agreements
  • Proof of following obligations for complaint processing, including communications and measures taken with the client
  • All communications related to a conflict of interest

Of course, each file should clearly indicate the client’s name as well as the account he is linked to. The representative may also include the following additional information:

  • Details on products and services discussed
  • All correspondence with the client
  • Notes on all communications with the client
  • Meeting summaries (date, time, location, topics of conversation, people present)

This file must allow inventory of all transactions executed by the brokerage on its own behalf and on behalf of each of its clients, including parties to the transaction and purchase or sale methods. It must also contain all the documents that justify the transactions completed on behalf of clients. Therefore, the following items must be included:

  • Client’s investor profile and updates
    • His identity, needs, objectives, financial situation and risk tolerance
    • Whether or not he is an insider for a reporting issuer or any issuer whose securities are traded on a market
    • His creditworthiness, if he is being granted a loan
  • Document from the Revenue Agency specifying the possible RRSP contribution, if applicable
  • Details on investments with other establishments
  • Projections prepared and provided to the client
  • Copy of any document justifying a recommendation
  • Client’s instructions and orders
  • Warnings made to the client if the instruction issued does not suit him
  • Transaction execution notices and transaction confirmations
  • Account statements and transaction statements
  • Any document related to a transaction with the client
  • Notes on communications with the client