Former registered representative Gabriel Ka Leung Lee of Edmonton has been fined $75,000 by the Investment Industry Regulatory Organization of Canada for failing to inform his advisory firm of off-the-book dealings with clients between 2008 and 2011.

According to the settlement agreement, in May 2008 Lee arranged a meeting between several of his high net worth clients at Edmonton branch of Richardson GMP Ltd. (RGMP) and a representative from a Hong Kong-based company called Asia Active Resources Ltd. (AAR) with the intention of arranging investments in the company.

Between 2008 and September 2011, six clients invested roughly $6,000,000 in AAR. All of the transactions were done off-book and none of AAR’s securities were held in any of the clients RGMP accounts. As well, AAR did not make any filings with the Alberta Securities Commission for private placements.

Then in September 2011, Lee arranged a short-term loan for $100,000 from two clients to AAR. The clients were repaid within one week. Again, Lee did not disclose his part in the transaction to his firm.

In another instance, Lee arranged an off-book equity investment for three clients in Castle Rock Research Corp. an Alberta-based textbook company. One client invested $350,000 in the company while two others, who had leant money to AAR, invested $850,000. Lee also invested a million dollars in the company from his personal RGMP account. Castle Rock went bankrupt in February 2012.

Finally, Lee borrowed $100,000 from a client, who was also invested in AAR, for the purpose of investing in a wine fund. As in the previous cases, Lee did not inform RGMP of his dealings with this client.

In addition to the fine, Lee most also pay $5,000 in costs and is prohibited from registering in any capacity for six months. Lee has not worked for RGMP since October 2011.