• DRA-2 DRA-2 Complaints to and Disciplinary Action at SRO

    • DRA-2.1 DRA-2.1 Complaints to Self-Regulatory Organizations

      • DRA-2.1.1

        All SROs shall have an appropriate mechanism to review complaints received against member firms and issuers of securities and shall endeavour to facilitate resolution of the complaints.

        July 2010

      • DRA-2.1.2

        In order for an unresolved complaint to be considered by the SRO, the complaint must be lodged with the SRO within 6 months of the receipt by the complainant of the CMSP's response referred to in rule DRA-1.1.7 or section DRA-1.2 and within 12 months of the conduct by the CMSP giving rise to the complaint.

        July 2010

      • DRA-2.1.3

        An unresolved complaint which is lodged subsequent to the period referred to in rule DRA-1.1.7 will be considered, provided that failure to lodge the complaint within the relevant period was through no fault of the customer.

        July 2010

      • DRA-2.1.4

        The SRO may request the CMSP and the complainant to provide copies of all relevant correspondence and documentation that is required to review the complaint. The SRO shall also send a copy of the complaint to the CMSD for information and also send a report on the final resolution of the complaint.

        July 2010

      • DRA-2.1.5

        The SRO shall endeavour to facilitate a resolution of the complaint between the member and the complainant.

        July 2010

      • DRA-2.1.6

        If the SRO is unable to facilitate a resolution of the complaint within 4 weeks of lodgement of the complaint with it, the SRO shall refer the unresolved complaint to the Arbitration Committee of the SRO.

        July 2010

      • Disputes that can be Brought before an SRO

        • DRA-2.1.7

          All types of disputes with a CMSP may be brought before and dealt with by an SRO (known as 'eligible disputes') subject to the following conditions:

          (a) The CMSP involved in the dispute must be one which is subject to the jurisdiction of an SRO by reason of it being a member of an SRO, or an issuer whose securities are offered for trading (listed) on the SRO;
          (b) The activity or dispute arises out of matters relevant to the CMSP complainant being or having been a client or shareholder of the CMSP;
          (c) The activity to which the complaint relates must be subject to the jurisdiction of the SRO;
          (d) The CMSP has failed to resolve the complaint to the satisfaction of the complainant within 4 weeks of receiving it; and
          (e) The CMSP about which the complaint is made must be a member or listed at the time of the act or omission to which the complaint relates and must continue to be a member or listed at the time when the complaint is referred to the SRO.
          July 2010

        • DRA-2.1.8

          All disputes which have not first been raised by a complainant with the CMSP, so as to provide the CMSP with an opportunity to resolve the dispute, will be deemed a complaint and if lodged or attempted to be lodged with the SRO shall be referred back to the CMSP for its due consideration.

          July 2010

        • DRA-2.1.9

          The following complaints cannot be brought before an SRO:

          (a) Commercial decisions not related to market transactions;
          (b) Pricing policies and other policies such as interest rates and fees;
          (c) Cases under investigation by any law enforcement agency, including cases where allegations of fraud or criminal activity have been made, and where the matter has been referred to the police for investigation;
          (d) Complaints that are more than 6 months old after the CMSP's final reply;
          (e) Complaints that have been settled privately or otherwise between the complainant and the CMSP; and
          (f) Cases which have been subject to a court hearing and for which a court judgment and/or order has been passed.
          July 2010

      • Dispute Submission to an SRO

        • DRA-2.1.10

          To initiate an investigation of a dispute and to require an SRO to resolve the dispute, a complainant must complete and submit the dispute to the SRO, along with the facts of the case and evidence in support of the claims made by the complainant.

          July 2010

      • Time Limits for Making an Application

        • DRA-2.1.11

          An application for initiating an investigation can only be made by the complainant:

          (a) Upon showing that an attempt has been made to resolve the matter by the CMSPs internal dispute resolution procedure, but the matter has not been resolved to the satisfaction of both parties or after at least 4 weeks from the date the matter was referred to the CMSP, whichever is earlier; and
          (b) No later than a period of 6 months after the CMSP has provided its final reply to the complainant.
          July 2010

        • DRA-2.1.12

          In rule DRA-2.1.11, a final reply is a letter or other written document issued by the CMSP to the complainant, which expressly states that it is the CMSP's final reply and which expressly informs the complainant that if he/she disagrees with the CMSP, he/she can contact the SRO for assistance within 6 months from the date of the said letter or other written document.

          There must be no outstanding issues between the CMSP and the complainant and the contact particulars of the SRO must be provided in the said letter or other written document. For the avoidance of doubt, any dispute as to whether any letter or other written document constitutes the final reply from the CMSP would be solely determined by the SRO. The SRO's determination would be binding on the CMSP and the complainant.

          July 2010

      • Investigation of a Dispute

        • DRA-2.1.13

          The SRO shall be entitled to request all relevant data and materials relevant to the dispute from the CMSP and the complainant, and the CMSP and complainant shall provide to the SRO all such information and materials as are relevant to the dispute. Specifically, the SRO shall write to the CMSP, advising it of the dispute referred to it by the complainant and request all relevant data and information.

          July 2010

        • DRA-2.1.14

          The CMSP shall respond to the request referred to in paragraph DRA-2.1.13 and provide a report compiled by the CMSP upon conclusion of its investigation into the dispute first raised to it by the complainant in full, the grounds of its decision and any other relevant information and documents relevant to the dispute.

          July 2010

        • DRA-2.1.15

          The SRO shall conduct any interviews, if deemed necessary, in the sole discretion of the SRO, either via the telephone or in person.

          July 2010

        • DRA-2.1.16

          The SRO shall then consider whether to dismiss the dispute in accordance with paragraph DRA-2.1.18. If the dispute is not dismissed in accordance with paragraph DRA-2.1.18, the case shall be classified as an 'investigated dispute' and the SRO shall refer the investigated dispute to mediation.

          July 2010

        • DRA-2.1.17

          While the SRO is conducting an investigation of a dispute, the SRO may nevertheless seek to promote a resolution of the dispute by agreement between the complainant and the CMSP.

          At all times while the dispute is being investigated by the SRO, the CMSP and the complainant may seek an amicable resolution of the dispute.

          July 2010

      • Dismissing Dispute without Mediation

        • DRA-2.1.18

          The SRO may, subject to the approval of the SRO's Chief Executive Officer, dismiss a dispute where:

          (a) The dispute is in the opinion of the SRO frivolous or vexatious;
          (b) The matter has previously been considered or excluded by a former scheme, but has not been adjudicated upon under paragraph DRA-2.1.22 and an award made under Chapter 3 (unless material new evidence likely to affect the outcome has subsequently become available).
          For the avoidance of doubt, all cases which have been settled as set out in rule DRA-2.1.9 (f) or for which an award has been made by the adjudicators must be dismissed;
          (c) There are other compelling reasons why it is inappropriate for the dispute to be dealt with by the SRO; or
          (d) The complainant is not cooperating.

          For the avoidance of doubt, all decisions made by the SRO under this rule shall be final and conclusive and cannot be challenged by the complainant or the CMSP.

          July 2010

      • Cooperation from Parties

        • DRA-2.1.19

          The SRO:

          (a) Shall receive the full cooperation and assistance of the CMSP and any representative of the CMSP in the investigation of the dispute;
          (b) May require from the CMSP and any representative of the CMSP all information relating to the subject matter of the dispute in its possession or control, or agreed to by parties in writing to be disclosed or which parties are compelled by law to disclose; and
          (c) Shall have the power to request the CMSP and/or such of the CMSP's representatives as it deems necessary to attend interviews or to provide written statements.

          The CMSP shall provide the SRO with all relevant data, information and materials as are relevant to the dispute to enable the SRO to comprehensively mediate the dispute, and shall attend or ensure that its representative attends all such interviews as the SRO has requested the CMSP and/or its representative to attend. The CMSP shall at all times comply, and shall ensure that all its officers, representatives and/or agents comply with all instructions and determinations made by the SRO and such officers and employees of the SRO are duly authorised.

          July 2010

        • DRA-2.1.20

          The SRO shall endeavour to complete the deliberation within a reasonable time, taking into account the complexity of the dispute.

          July 2010

      • Referring Dispute to Arbitration

        • DRA-2.1.21

          Where the dispute is resolved by mediation, the SRO shall record in writing the terms of the resolution reached by both parties. Where the dispute is not resolved by mediation, the CMSP or the complainant can opt to have the dispute proceed to Arbitration in the manner set out in Chapter 3.

          July 2010

        • DRA-2.1.22

          Where a dispute is not resolved by the SRO through mediation, the CMSP will be informed and afforded a final opportunity to resolve the dispute. If the CMSP does not resolve the dispute, the SRO shall refer the matter to the Arbitration Committee and initiate Arbitration proceedings, as per Chapter 3 of this Module.

          July 2010

    • DRA-2.2 DRA-2.2 Disciplinary Action at SRO Pursuant to Complaints

      • DRA-2.2.1

        In addition to facilitating the resolution of complaints and providing an arbitration mechanism, all SROs shall analyse complaints received together with all the relevant information, records and data available with the SROs, in order to detect potential cases of contraventions of the CBB Law and regulations, SRO's business rules and other applicable laws, rules and regulations by any person.

        July 2010

      • DRA-2.2.2

        If the analysis of the known facts and potential evidence indicates contraventions, the SRO shall consider whether a sufficient, credible source of facts and evidence suggests contravention of the CBB Law, rules and regulations or business rules of the SRO. Some of the factors that could be considered by the SRO include, but are not limited to:

        (a) The laws or rules or regulations that could potentially be considered as having been contravened or violated;
        (b) The severity and/or seriousness of such contravention or violation;
        (c) The potential magnitude of such contravention or violation;
        (d) The potential losses involved or harm to an investor or investors;
        (e) Whether the affected group is particularly vulnerable or at risk; and
        (f) Whether the conduct is ongoing.
        July 2010

      • DRA-2.2.3

        After conducting an analysis referred to in rule DRA-2.2.2, the SRO shall, based on the evidence and facts available, undertake an investigation for imposing disciplinary action as per Chapter 4 of this Module and simultaneously report the matter to the CMSD of the CBB.

        July 2010

      • DRA-2.2.4

        The SRO shall conduct its own investigations and initiate disciplinary proceedings as per its business rules. This is without prejudice to any enforcement measures by the CBB or criminal prosecution.

        July 2010

      • DRA-2.2.5

        The SRO's report to the CMSD shall include:

        (a) Facts of the case;
        (b) Laws, rules and regulations, or business rules of the SRO that could potentially have been contravened or violated;
        (c) Prima-facie conclusions and evidence available; and
        (d) Scope and nature of the investigation undertaken by the SRO.
        July 2010

      • DRA-2.2.6

        SROs shall complete the investigation referred to in rule DRA-2.2.4 and paragraph DRA-2.2.5 promptly and shall determine whether a reference to the disciplinary committee is required. The findings of the investigations and the conclusions arrived at after the investigation along with supporting facts and evidence shall be submitted to the CMSD within a period of 30 days from the date on which the matter was reported to the CBB, as per rule DRA-2.2.3.

        July 2010

      • DRA-2.2.7

        The CMSD will consider any report referred to in rules DRA-2.2.3 and DRA-2.2.6 from the SRO, along with the information, records and data available with the CMSD for the purposes of market surveillance, investigation and enforcement functions, as per the Market Surveillance, Investigation and Enforcement Module (MIE Module).

        July 2010