A hearing panel of the Mutual Fund Dealers Association of Canada (MFDA) has placed a permanent prohibition on conducting securities-related business on Vasant Pragjibhai Patel after he admitted to engaging in outside activities not disclosed or approved.
The Pacific Regional Council of the MFDA also fined Patel $25,000 and costs of $5,000.
In the agreement, Patel admitted to soliciting or making referrals to at least 15 people, none of whom were his clients, to invest in a real estate development project totalling more than $4.3 million. He also registered a company and served as its president and director contrary to MFDA regulations.
Patel received at least $425,000 in fees or compensation, keeping $40,500 for his own benefit and paying the rest to business partners who helped him solicit the investors.
In 2017, the Supreme Court of British Columbia issued a receivership order as a result of foreclosure actions commenced by lenders to the real estate project who had advanced money for the development's construction of the real estate development. The receiver determined that creditors were owed about $62 million, more than double the property’s value.
