MFDA fines and bans former rep for misappropriating funds

A former mutual fund representative has been fined and permanently banned after a regulatory hearing panel found that he misappropriated client funds and misled his dealer.

A Mutual Fund Dealers Association of Canada (MFDA) hearing panel ruled that a former rep with CIBC Securities Inc. in Vancouver, Adeleke Rasaq Olanrewaju, is fined $85,000, ordered to pay $10,000 in costs, and permanently banned.

The sanctions follow a finding that Olanrewaju misappropriated $30,000 from a client in 2018. The client was a foreign student who was attending the University of British Columbia at the time.

After the client complained, Olanrewaju returned almost $22,000.

Soon after, he was terminated by the firm, which also repaid the client the rest of the $30,000.

“It goes without saying that the misconduct in the present case is serious,” the panel said in its decision. “Misappropriating clients’ funds is a serious breach of trust and undermines the reputation and integrity of the securities industry.” It added that the misconduct was aggravated by Olanrewaju allegedly lying to his dealer about the status of the client’s money during its investigation.

The panel said that a rep misleading their dealer is “serious” misconduct. “Not only is it a violation of the standard of conduct expected of an approved person, it also interferes with the ability of the member to supervise the conduct of the approved person,” it said.

Olanrewaju did not participate in the disciplinary panel’s hearing against him, and the panel noted that he “may have left Canada” but that this factor is “irrelevant in assessing penalties.”

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.