Orillia area financial advisor no-shows regulatory hearing after $1.8 million fraud conviction

An Orillia area financial advisor who admitted to defrauding clients out of their life savings didn't show for his regulatory hearing.

An Orillia area financial advisor who admitted to defrauding clients out of their life savings was nowhere to be found for the start of his regulatory hearing Monday in Toronto.

Kevin Douse, 41, was scheduled to appear before the Canadian Investment Regulatory Organization, known as CIRO, to respond to allegations he defrauded clients who believed he was investing their money.

The hybrid hearing, held under the Mutual Fund Dealer Rules, concerns allegations that Douse “misappropriated or otherwise failed to account for monies that he obtained from clients and other individuals” and failed to cooperate with an investigation by CIRO staff into his conduct.

The prosecution laid out how Douse misappropriated hundreds of thousands of dollars from at least seven clients over several years by forging documents and signatures, taking money meant for retirement investments and tax-free savings accounts, and depositing the money into his personal bank accounts to pay his bills and other victims.

One witness, an investigator with the regulatory organization, testified about her findings and Douse’s unwillingness to cooperate with the investigation.

Douse, who was arrested and charged by provincial police earlier this year following a 16-month investigation, pleaded guilty in September to defrauding 25 clients, many of whom were longtime friends and loved ones, out of nearly two million dollars between 2016 and 2023.

The CIRO panel heard Douse asked clients to personally write him cheques worth tens of thousands of dollars; he then deposited the funds into his bank accounts and used the money for himself without their knowledge. Several exhibits were shown to the panel, including cheques and financial statements victims said Douse manipulated to continue his scheme.

The investigator told the panel Douse worked for an investment company known as Quadrus for several years, testifying the company, which conducted its own investigation, found Douse fabricated documents, providing fake statements to fool clients who thought their money had been invested. Douse also worked for a now-defunct company known as WLTH Inc., based out of Orillia.

The hearing has a standard of proof on a balance of probabilities, meaning the prosecution must prove Douse is more likely guilty of the allegations than not. The proceedings are scheduled to continue through the end of the week.