A former mutual fund salesperson in Ontario has been fined $150,000 by the Mutual Fund Dealers Association of Canada (MFDA) for facilitating client investments in a company in which he had an interest, among other regulatory violations.

Following a disciplinary hearing held in Toronto on Thursday, the MFDA revealed penalties facing Punch Bun Chiu Lui, who was registered in Ontario as a fund salesperson with Investia Financial Services Inc. from August 2005 to March 2010.

In addition to his role at Investia, Lui was also apparently involved in the management of Ameradio Inc., a Richmond Hill, Ont.-based company which had its corporate status cancelled last year. Lui’s duties at Ameradio included accounting, drafting financial plans for the company and performing banking transactions, among other things, according to the MFDA. He was promised $4,000 per month in compensation, and was ultimately paid a total of approximately $28,000 from January to July 2005.

The hearing panel found that Lui breached MFDA rules by arranging for two clients to invest in Ameradio. The clients invested a total of $170,000 in Ameradio, and Lui assured the clients that they would be repaid their investment in full in three years, along with interest. He did not confirm the terms of their investment in writing or provide them with any documents in respect of the investment.

Investia was not advised of the investment, nor was it informed of Lui’s involvement with Ameradio.

The investment gave rise to a conflict of interest between Lui’s interests and those of the clients given his interest in the company, according to the MFDA.

Lui claims that as of February 2006, he ceased to be involved in Ameradio.

In 2007, the clients were repaid $50,000 of their investment, plus an unspecified nominal amount of interest. Of the remaining $120,000 of their investment, they have been repaid only about $2,000; with the remaining $118,000 and all accrued interest still outstanding.

In January 2010, Lui declared personal bankruptcy and identified the two clients as creditors. In March 2010, he was terminated by Investia.

Lui breached MFDA rules by failing to deal fairly, honestly and in good faith with clients, and by continuing in another gainful occupation that was not approved by his firm, in respect of his involvement in Ameradio.

Lui has been permanently prohibited from conducting securities related business in any capacity for any MFDA member firm, and faces a fine of $150,000 and costs of $7,500.