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A hearing panel of the Prairie Regional Council of the Mutual Fund Dealers Association of Canada has imposed a permanent prohibition on Wayne Larson from conducting securities related business and a fine of $205, 000.

In the reasoning for its decision among some of the instances of misconduct included Larson’s dealing with fraudulent companies, including a phony online lottery solicitation.

In summer/fall of 2005, Larson had received an email indicating that he had €1 million in the Lucky Day Lottery. In order to receive his winnings, he would have to send money to the lottery company to cover the taxes, withdrawal fees and other miscellaneous fees.

According to the MDFDA decision, Larson did not pursue the winnings. However, when he was “advised” that his winnings could grow to €4 million, he gave the lottery $600,000.

Further, Larson cashed a cheque on behalf of the lottery that ended up being fraudulent. CIBC, the bank through which he cashed the cheque, contacted Larson and advised him he was responsible for paying the bank $250,000.

The hardship with CIBC came while Larson was also being invested in a “non-approved” Nigerian based construction firm, called Global Consulting Corporation.

Based on Larson’s significant financial difficulties resulting from his involvement in the Lucky Day Lottery, he began seeking other investors in Global. His clients invested more than $1.1 million the company. Global was not an approved MFDA investment.

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MFDA penalizes for side-business

The Mutual Fund Dealers Association has imposed a fine of $10,000 against Alden M. Kaley, a New Brunswick-based advisor with Investia Financial Services, for failing to disclose he was the director of a company that distributes preferred shares through his dealership.

Kaley admitted to the MFDA that he participated in the sale of the preferred shares to the public. This constituted securities related business that was carried on through the facilities of Investia, contrary to MFDA Rule 1.1.1(a).

Kaley also admits that from at least April 3, 2006 to August 2007, he carried on another gainful occupation that was not properly disclosed to and approved by the member firm in his role as co-owner and director of The Ledges, contrary to MFDA Rule 1.2.1(d).

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BMO changes Emerging Market Class

As a result of a proposed fund merger involving its current underlying fund, the BMO Emerging Market Class is expected to become BMO Emerging Markets Fund. The investment objective of the fund is to provide long-term capital appreciation.

Currently, the fund seeks a similar return to BMO Guardian Emerging Markets Fund by investing primarily in units of that fund. On the effective date of the merger, the fund will seek a similar return to BMO Emerging Markets Fund by investing primarily in units of that fund.

The anticipated merger of BMO Guardian Emerging Markets Fund into BMO Emerging Markets Fund will occur on or about Nov. 27, 2009, pending unit holder and regulatory approval.

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Criterion winds down U.S. Buyback Fund

Criterion Investments Inc., the manager and trustee of Criterion U.S. Buyback Fund is in the process for winding up the fund.

Unit holders are permitted to redeem their units anytime between now and the termination date, which is expected to be Dec. 29, 2009. Any redemption requests during that time may be subject to a redemption charge or fee if initially purchased on a deferred sales charge or low load basis.

Unit holders of record as of the date of termination of the trust will receive their proportionate share of all property and assets of the fund. Any redemption fee or charge that would normally be associated with a redemption will be waived and absorbed by Criterion.

(11/02/09)