The Mutual Fund Dealers Association has fined a former B.C. mutual fund salesperson $25,000 for violating several MFDA rules, including involvement in outside business ventures without disclosing them to his firm, and persuading clients to invest in these ventures.

An MFDA hearing panel announced on Wednesday that it has accepted a settlement agreement with Douglas Ruemper, who was a registered mutual fund salesperson with Quadrus Investment Services Ltd. from 2004 to 2008, and with Performa Financial Group Limited from 1997 to 2004.

In the settlement agreement, Ruemper admitted to being involved in 12 gainful occupations that were not disclosed to and approved by his firm, including positions as directors, executives and transfer agents with a variety of business ventures.

Between 2004 and 2006, he sold $105,000 in shares of two companies in which he had an interest — through his firm’s facilities — to five clients.

Ruemper also admitted that he engaged in personal financial dealings with another client who had agreed to invest in one of Ruemper’s ventures, by paying the client $29,000 of his own resources, purportedly on account of the client’s investments.

During this period, he also failed to report to his firm complaints from the client, and offered to pay the client $10,000 to settle the complaint without the prior written consent of the firm.

The MFDA hearing panel also found that Ruemper’s violations represented failures to comply with his firm’s policies and procedures.

Ruemper was terminated from Quadrus in 2008 as a result of these violations.

He has been permanently prohibited from conducting securities related business in association with any MFDA member firm, and has been ordered to pay costs of $2,500 in addition to the fine.

IE