A mutual fund client, Mr. Henderson, informs his representative that he is dissatisfied with the performance of his growth fund and alleges that the representative misstated its potential returns during their initial meeting. How should the representative initially proceed according to CIRO's complaint handling requirements?

Question: A mutual fund client, Mr. Henderson, informs his representative that he is dissatisfied with the performance of his growth fund and alleges that the representative misstated its potential returns during their initial meeting. How should the representative initially proceed according to CIRO's complaint handling requirements?

Answer options:

• Immediately offer to switch Mr. Henderson's investment into a different fund to placate him. ✅ Inform Mr. Henderson that his complaint will be formally documented and escalated to the firm's compliance department for review.
• Advise Mr. Henderson that market fluctuations are normal and that he should simply wait for recovery.
• Apologize for his dissatisfaction and offer to review the fund's historical performance data together without further action.

Correct answer: Inform Mr. Henderson that his complaint will be formally documented and escalated to the firm's compliance department for review.

Explanation: Upon receiving a complaint, a representative must acknowledge it and ensure it is escalated for formal handling as per CIRO's requirements. This involves documenting the complaint and passing it to the appropriate compliance personnel for investigation and resolution.