Shawn Kimel, the founder of Toronto-based hedge fund K2 & Associates Investment Management Inc., has paid the Ontario Securities Commission a $550,000 penalty and agreed to a nine-month prohibition on trading in both a personal and professional capacity to settle allegations of manipulative trading. The settlement, approved Friday by a three-member panel of commissioners chaired by OSC vice-chair Grant Vingoe, also stipulates that K2 will submit to a review of its trading practices and procedures by a third party acceptable to the regulator.