Following reports of an investigation into whether millions are missing from a pair of fund families, Morningstar Canada has dropped coverage of the funds for fear that their data may be inaccurate.

Morningstar Canada announced that it has dropped coverage of the Norbourg and Evolution funds (managed by Norbourg Asset Management Inc.), effective immediately, after it was reported that Quebec regulators and the RCMP are investigating several serious allegations against the firm.

Yesterday the Autorité des marchés financiers said it is looking into: whether almost $70 million has been embezzled from the funds; a $70.7 million discrepancy between its financial statements and assets under management; alleged misrepresentations in its financials; and, alleged document forgery. None of these allegations have been proven, and no charges have been laid.

However, given the nature of the allegations, Morningstar is concerned that the data it has been provided by the firm may not be accurate. It previously covered the eight Norbourg funds and 19 Evolution funds that Norbourg manages.

Today, Morningstar removed the 27 funds from all of its Web-based products and services. The funds remain on the already issued July 31 release of the desktop-based PALTrak and BellCharts products, but will be removed from the Aug. 31 release, the firm reported.

As of July 31, Morningstar reported that the funds held a combined $180.2 million in assets –$146.1 million in the 19 Evolution funds sponsored by Quebec City-based Evolution Funds Inc., and $34.1 million in the eight Norbourg funds.