Gary Ng, a former Winnipeg investment adviser and owner of a Winnipeg asset management company, has been fined $ 5 million by the Canadian Investment Industry Regulatory Organization (IIROC), the highest fine it can.
IIROC claimed that Ng falsified financial information to secure loans that eventually allowed him to obtain $ 100 million in Vancouver-based PI Financial in 2018.
The IIROC also “accused” the NGO of failing to cooperate with the regulator’s law enforcement agencies, which is contrary to the registration rules.
In addition, the IIROC has also ordered him to pay $ 194,000 to cover the costs of the IIROC in investigating the matter and is excluded for life from being able to register as an official in any capacity with any entity regulated by the IIROC.
Ng was not present at a hearing held last week in Toronto, but was represented by a lawyer.
According to the IIROC statement of allegations, in 2018, when Ng was the director of the small Winnipeg company Chippingham Financial Group Limited, PI Financial, which financed it through two loans for $ 80 million and $ 20 million, which Ng personally guaranteed, and by providing part of Chippingham. accounts as collateral.
But Ng didn’t actually own or control the securities accounts pledged as collateral, but he forged documents to make it look like it did.
According to IIROC, he subsequently arranged two more loans totaling $ 72 million, also on the basis of counterfeit collateral.
Specifically, the IIROC said it significantly overestimated the value of the assets in the accounts; amended the securities statements of two unrelated clients, Chippingham and PI Financial, by changing the names of the clients to their own name so that the assets of those clients appeared to be its property; and created fictitious account statements, summaries, and screenshots to make it appear to hold millions of dollars in financial assets at Chippingham and PI Financial, when in fact those accounts and claimed assets did not exist.
IIROC learned of the fraudulent activities in January 2020 after being informed by PI Financial officials. Ng resigned in February 2020.
Ng’s colleague, Donald Warren Metcalfe, faces similar allegations, but his case has not yet been discussed in IIROC criminal proceedings,
The regulator stated that it did not find any evidence of client losses during the investigation.
In an interview with Free press in 2018, just after PI Financial Acquisition, Ng, 38, acknowledged that it might have looked like he had bought PI Financial, which at the time employed 300 people and managed $ 4.5 billion in assets.
But the son of Hong Kong immigrants mocked the proposal.
“I didn’t come with the money,” he said. “I’ve been working very hard for a long time and taking a lot of risks. But I’m still the same guy. I just have a nicer watch now.”
About a year later he was forced to resign.
An IIROC official said Ng had 30 days to appeal the decision.
Although the IIROC does not have the power to secure wages or impose liens on real estate, it can register the decision as a court judgment and then go through the process of determining whether Ng has property that could be confiscated.
Ng also faces criminal prosecution.
In January, the RCMP charged Ng with one fraud over $ 5,000 and one laundering the proceeds of crime.
The RCMP stated that the allegations of fraud stemmed from the RCMP’s investigation into allegations that Ng had secured loans and credits from a number of victims / creditors by submitting false collateral in loan and loan applications.
The second fee results from the use of obtained loans and credits Ng.
Martin Cash has been writing columns and business reports for the Free Press since 1989. During these years, he went through a number of business cycles and the rise and fall (and rise) of the wealth of many local businesses.
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