A Mutual Fund Dealers Association of Canada (MFDA) regulatory hearing panel has fined former mutual fund representative Conrad Eagan $5 million and ordered him banned permanently from the investment industry after concluding that he stole approximately $3.5 million from former clients and the estates of former clients.

The MFDA announced late on Tuesday that a hearing panel has ruled that all six of the allegations that its enforcement staff brought against Eagan were proven at an MFDA hearing. Eagan did not participate in the hearing and the hearing panel’s decision indicates that he is also facing criminal charges, civil lawsuits as well as other regulatory investigations.

“The evidence establishes, beyond any possible controversy, that [Eagan] has committed a gross misappropriation of money that did not belong to him,” the hearing panel concluded.

In particular, hearing panel found that Egan misappropriated a total of about $3.5 million from various clients, the estates of deceased clients and a dormant account. According to the decision, Eagan prepared wills for several clients and was named as the executor in those wills — and he used this position to misappropriate money from the estates.

Eagan was registered as a rep in Ottawa with Desjardins Financial Security Investments Inc. from 1987 to 2011 and at Worldsource Financial Management Inc. from 2011 to 2012, when the firm terminated him after it uncovered his conduct.

Eagan was subsequently accused of stealing from clients; acting as an executor for clients against MFDA rules; engaging in unapproved outside business activity by preparing wills for clients; engaging in improper personal financial dealings with a client; providing clients with false documents; and failing to co-operate with the regulator’s investigation.

“The evidence shows that Conrad Eagan is a thief. He stole approximately $3.5 million. In all but one case, he stole from people who had put their trust in him as their financial advisor,” the hearing panel said in its decision. “His conduct strikes at the heart of a civilized society.”

In determining his fine, the hearing panel said that there were no mitigating factors in the case, but that there were aggravating factors.

“What is seriously aggravating is the fact that the respondent is a sophisticated person with long experience in the financial industry. He should have known better. He must have known better,” it says. “He was cavalier of his most fundamental obligations to his clients and their beneficiaries who suffered serious financial harm as a result of his misconduct. His misconduct was obviously deliberate and calculated. It extended for years.”

The hearing panel also said that “sometimes there is little purpose to be served by imposing a fine when it is obvious that it is unlikely to be paid. This case, however, is so egregious that it seems to us that the requirement of general deterrence calls for the imposition of a substantial fine. If there is ever a case for a maximum fine, it is this one.”

The hearing panel set the fine at $5 million, along with the permanent prohibition, and ordered $15,000 in costs.