Regulator infers money laundering or tax evasion by Vancouver mutual fund dealer

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Regulators in Canada fined Meng Xi Li, a former CIBC Securities Inc. mutual fund dealer, $100,000 and ordered to cease further work in the securities industry after she was found to have violated a number of trading rules. Evidence provided by the defendant when asked for the Reason for the Decision posted on the Mutual Fund Dealers Association (MFDA) website helped the regulators to infer that the dealer was involved in money laundering or tax evasion scheme.

It was discovered by MFDA that Li violated a lot of trading rules when she was managing funds for her future husband and his nephew, although she said she never met the nephew. She allegedly opened an unregistered account with CIBC in the nephew’s name and completed several transactions between the nephew and her husband including 33 purchases for the nephew accounts in 2016 between $50,000 and $250,000, and then redeemed the mutual funds on July 9, 2017.

According to the MFDA Panel, she attempted to move about $1.36 million from the nephew’s CIBC Bank account to her husband account in the same January and then closed both accounts. And later in January, the nephew visited in CIBC Bank Branch and claimed to know no Li and has no knowledge of any bank or mutual fund accounts in his name. However, all evidence provided by the MFDA regulators was based on hearsay, however, it was admitted because the allegations of misconduct raised against Li are very serious. Following the hearing in 2019, the Cullen Commission of Inquiry into Money Laundering will begin latest February 24 with a week of hearings.