It was ruled recently that a former White Rock, British Columbia-based mutual fund salesperson defrauded his clients of about $1.6-million over a six-year period according to a July 15 report in Canada News Wire.
Robert Maudsley and Shaylor Management Ltd. were found by the British Columbia Securities Commission to have violated the Securities Act in committing fraud. Maudsley had convinced 23 clients to redeem about $1.6 million in mutual fund holdings to invest in other securities. Maudsley never invested the money.
Instead he took the clients' money to fund his own personal expenses, including a self-admitted substance abuse problem. It was reported that a witness described Maudsley's substance abuse problem as "his cocaine and gambling habit and alcohol addiction."
Nearly half of Maudsley's clients were over 70 years old and three of the clients suffered from mental or physical disability.
"He simply took their money, or caused Shaylor to do so - about as stark an instance of deceit as there can be," the BCSC panel said.
The violations were committed when Maudsley was a mutual fund salesperson at Investors Group Inc.'s South Surrey regional office in White Rock between 1996 and 2003. He was fired on Mar. 3, 2003.
Investors Group, the largest distributor of mutual funds in Canada, has compensated the victims over $2.3 million.