CIRO fines adviser who kept processing withdrawals after client reported fraud

An investment adviser who continued processing withdrawals from a senior’s retirement account after the client reported being a fraud victim has been fined $7,500 by a CIRO hearing panel.

In Re Sharifian, 2026 CIRO 20, the Canadian Investment Regulatory Organization’s New Brunswick District panel approved a settlement with Sholeh Sharifian and ordered a further $5,000 in costs. The settlement was accepted May 4, 2026, with written reasons issued July 9.

The case concerns an adviser’s duty to respond to warning signs, not a finding that Sharifian committed the underlying fraud. The client requested the withdrawals, and the money was paid to the client’s bank account. The admitted misconduct was failing to make adequate inquiries and report the information to the dealer.

Retirement savings were being depleted

Sharifian worked with Sun Life Financial Investment Services (Canada) Inc. and was registered in New Brunswick, with registrations in Alberta and Ontario during parts of her tenure. She opened the client’s registered retirement savings plan in June 2019 and was responsible for servicing it. The client had little or no investment knowledge and a low-to-medium risk tolerance.

Between November 2020 and May 2021, the client requested six redemptions totalling $146,964.29. The first requests were explained as a response to reduced income during the pandemic. By the second request, the client described being in financial jeopardy.

On March 25, 2021, the client requested a $30,000 withdrawal and expressly told Sharifian that she had been a fraud victim and needed money to address the situation. Sharifian processed four redemptions totalling $61,250 after receiving that information.

The requests continued as the client reported being short of money. In May, after missed insurance premiums and an overdraft, Sharifian suggested another RRSP withdrawal. The client asked for more than the account contained and ultimately requested the remaining funds. A $6,250 redemption left approximately $156 in the account.

Sharifian knew the repeated redemptions were depleting the senior’s retirement savings, but did not adequately investigate the circumstances of the reported fraud or the client’s financial position. She also failed to tell the dealer about the unusual requests and fraud warning. A later family complaint was reported to the dealer, which investigated and paid compensation accepted by the client; the reasons do not specify that payment’s amount.

Following instructions was not enough

The dealer’s policies identified unusual or repeated urgent withdrawals as warning signs. They required particular caution where seniors were withdrawing capital faster than investment returns could replace it, and called for concerns to be documented and discussed with management and the dealer.

The panel said that when information indicates a client may be vulnerable, in financial distress or a fraud victim, the adviser must make adequate inquiries and promptly report the relevant information under the dealer’s procedures. A belief that the adviser is helping the client does not excuse failing to investigate, verify instructions and escalate suspicious circumstances.

In this case, the panel said Sharifian should at least have requested a meeting, reviewed the circumstances, documented the discussion and sought guidance from her manager and the dealer. It found the admitted facts established breaches of the conduct, know-your-client and supervisory-compliance rules.

A negotiated penalty, not a fraud-loss award

The panel’s role was to accept or reject the settlement, applying a reasonable-range test rather than selecting a penalty anew. It considered investor protection, proportionality, deterrence and confidence in the regulatory system, while recognizing the time and expense saved by the admissions.

There was no evidence that Sharifian benefited financially from the misconduct, and she had no previous disciplinary record. The dealer had placed her under close supervision and later terminated her. She also supplied evidence supporting her limited ability to pay a larger monetary penalty.

The panel found the agreed fine and costs meaningful enough to deter similar failures. The settlement also requires compliance with the relevant rules upon any future registration; it does not impose a permanent prohibition or suspension. The payments were due on acceptance unless staff and Sharifian agreed otherwise.

The redemption totals are not findings that every dollar was lost to fraud, and the regulatory fine is separate from the compensation the dealer paid. The decision does not establish that the fine or costs have been collected. CIRO’s official case page records the proceeding as concluded on May 4; a focused later-status check did not identify a subsequent change.