A Vancouver stockbroker allegedly siphoned over $2 million from client accounts to build a home in Naramata, according to regulators.
Jeffrey Rutledge carried out unauthorized wire transfers of approximately $1.79 million and US$255,600 from client investment accounts, according to a hearing notice from the Investment Industry Regulation Organization of Canada (IIROC), the country’s self-regulating body for licensed investment dealers.
Between August 2016 and October 2018, Rutledge is alleged to have “misappropriated” the $1.8 million from a couple from Nanoose Bay and the American funds from a company called SB Inc., contrary to IIROC rules, the notice states.
Rutledge started working in the securities industry in March 1981. He began working in Vancouver at PI Financial Corp. in August 2012.
PI Financial is where Rutledge committed the alleged offenses. Upon hearing of the clients’ complaints in November 2018, PI Financial terminated Rutledge.
Rutledge allegedly used documents with forged signatures to accomplish 35 illegal wire transfers that funnelled nearly $900,000 to an Okanagan law firm and nearly $500,000 to a modular home manufacturer and contractor. He also allegedly transferred $100,000 to a family member’s company and just over $62,000 to the estate of the father of Rutledge’s wife, according to the notice. As well, he allegedly used the company’s American funds to pay for a home demolition and provide even more money to family members.
In December 2018, IIROC informed Rutledge it was launching an investigation, which he never cooperated with, according to the agency. Rutledge did not attend his Nov. 9, 2020 investigatory interview.
Rutledge and his wife Sally Rutledge were sued by investors Robert Slaughter and Sharon Slaughter in November 2018. The case has not been active since April 2019, when the Slaughters dropped PI Financial Corp. as a defendant.
It’s unclear if the Slaughters recouped their money from the brokerage firm.
The Slaughters claim Jeffrey Rutledge told them his cousin withdrew the money to buy a home in the Okanagan, however the Slaughters noted a new land title in Naramata for a $1.15-million home was under the Rutledges’ name in 2017.
He is scheduled to appear before an IIROC panel on May 26. If the panel determines Rutledge violated rules, he faces administrative penalties, including disgorgement of ill-gotten gains, fines and penalties.