An advisor whose clients have used social media to air their grievances has been handed a lifetime ban by regulators
A British Columbia Securities Commission (BCSC) panel has permanently banned Rodney James Wharram from the province's capital markets and fined him over $1 million for fraud.
The panel ordered that Wharram pay to the commission $517,500, the amount obtained a result of his misconduct. Wharram and three companies, The Falls, Deercrest, and West Karma, are jointly and severally liable for this amount. Wharram was also ordered to pay an administrative penalty of $500,000.
“In this case, the investor losses were significant,” the panel wrote. “Wharram's fraudulent misconduct was significant and repeatedly deceitful. As a consequence, it is necessary, for deterrence purposes, to order a significant administrative fine. Other market participants must know that significant financial sanctions will follow this type of misconduct.”
In February 2015, the panel found that Wharram, West Karma Ltd. and the Falls Capital Corp. committed fraud when they took $139,000 from Falls Capital, deposited it with West Karma, and then used it for Wharram's personal expenses.
The panel also found that Wharram, West Karma and Deercrest Construction Fund Inc. committed fraud when they took $130,000 from Deercrest, deposited it with West Karma, and then used it for Wharram's personal expenses.
Wharram and Deercrest were found to have committed fraud when they took $265,000 directly from Deercrest's bank accounts and used it for Wharram's personal expenses.
Wharram, the Falls, and Deercrest had originally raised the money taken by Wharram from investors for the purposes of developing a real estate project near Chilliwack, B.C.
The panel ordered that Wharram resign any position he holds as a director or officer of any issuer or registrant, and he is permanently prohibited from becoming or acting as a director or officer of any issuer or registrant.
He is also permanently banned from trading or purchasing securities or exchange contracts, acting as a registrant or promoter, engaging in investor relations activities, and acting in a management or consultative capacity in connection with the securities market. The panel also ordered that the Falls, Deercrest, and West Karma be permanently cease-traded.
