* Northern Securities CEO may not trade or deal for 2 years
* Fined C$625,000 after sanctioned for trading activity
* Northern applying for review of decision
TORONTO, Nov 13 (Reuters) - Activist investor Vic Alboini, an outspoken critic of Research in Motion, has been suspended and fined by Canada's investment industry watchdog after he was found to have engaged in improper and risky trading.
In a decision released late on Monday, the Investment Industry Regulatory Organization of Canada (IIROC) imposed on Alboini a two-year suspension "in all capacities" and fines totaling C$625,000 ($624,200) for actions taken in his capacity as chief executive of Canadian dealer Northern Securities, a unit of Northern Financial Corp.
Alboini is also permanently banned from being an "ultimate designated person." A UDP oversees an investment dealer's compliance system and is often the firm's CEO.
IIROC found that in late 2008 Alboini "engaged in a trading practice which improperly obtained access to credit" for his client at the time, Jaguar Financial, "and in doing so risked the capital of both Northern Securities and its carrying broker." Alboini is also CEO of Jaguar.
He also failed to ensure that Northern Securities corrected deficiencies in its business conduct and trading practices, IIROC said.
IIROC handed out smaller penalties to Frederick Vance, who as chief compliance officer at Northern was found to have failed to adequately supervise Alboini's trading activity, and to Douglas Chornoboy, who as chief financial officer filed or allowed the filing of inaccurate monthly financial reports.
Vance was given two concurrent three-month suspensions from acting in any supervisory capacity and fines of C$50,000. Chornoboy was fined C$25,000.
Northern Securities itself was fined C$300,000.
In a statement, the firm said it has applied to the Ontario Securities Commission for a hearing and review of IIROC's decision. It has also applied to the OSC for a stay of the IIROC sanctions pending the decision on the appeal.
Northern did not address how the IIROC decision would impact Alboini's future with the firm.
A former securities lawyer, Alboini has become notorious in Canadian investment circles for his activist stances at companies of which Jaguar has been a shareholder.
In 2009, Alboini played a crucial role in scuttling HudBay Mineral's friendly bid for Lundin Mining.
His latest target is RIM. Last year, he called for the company's co-chief executives to be replaced and demanded the appointment of an independent chairman, while also urging the company's board to consider selling the company or breaking it into three units.
Alboini was not immediately available for comment.
IIROC is Canada's self-regulatory organization which oversees all investment dealers. The Ontario Securities Commission is Canada's largest securities regulator.