Rep fined, banned for misappropriation

A regulatory hearing panel has fined and banned a former mutual fund rep accused of misappropriating money from another fund rep.

A hearing panel of the Mutual Fund Dealers Association of Canada (MFDA) permanently banned Azhar Ahmad Batla, a former rep with Investors Group Financial Services Inc. in Toronto, fined him $145,000 and ordered him to pay costs of $15,000 after finding that he violated MFDA rules.

The panel indicated that it will release its reasons for the decision and sanctions at a later date.

MFDA staff accused Batla of misappropriating money from a client, who was also a rep with a different dealer, in 2019, and of misleading his dealer about that conduct.

According to the self-regulatory organization’s allegations, the client provided Batla with a $70,000 bank draft and instructions to invest the proceeds in his wife’s account.

Instead, the SRO alleged that Batla deposited the money into his own account, claiming the funds came from his spouse/common law partner, and later withdrew that money to pay his personal expenses and to repay debts.

After the client complained, Batla repaid the client a portion of the money ($11,500), the SRO alleged, and the dealer compensated for the amounts that were not repaid.

The MFDA also alleged that Batla misled his dealer when it questioned him about his account activity.

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.