A marketing director and colleague at a Richmond-based investment firm have been fined a total of $70,000 after they coached a client to lie to a financial watchdog investigator.
The British Columbia Securities Commission (BCSC) fined FS Financial Strategies’ (FS) director “Janet” Zhang $40,000 and strategist Hunter Wei-Shun Wang $30,000 for obstructing justice by concealing or withholding, or attempting to conceal or withhold, information that was “reasonably required for an investigation under the Securities Act.”
In December 2020, a BCSC panel heard how Zhang and Wang spent time with the client role-playing the lies, with Wang pretending to be a BCSC investigator during a mock phone call.
After rehearsing the call repeatedly, Wang and Zhang listened in while the investor called the investigator and read the script with the false story.
The panel found that “this fabrication was clearly an attempt to cause the investigator to stop pursuing investigation of the complaint.”
After the call, the investor and his mother went with Zhang to her personal bank, where she withdrew $25,000 and gave it to the investor. A few weeks later, FS reimbursed Zhang for that payment.
Their connection dated back to 2014, when Zhang introduced a B.C. man to an investment at FS and Wang assisted her in the process of documenting the investment.
The investor initially put in $25,000 on the premise that he would be guaranteed a 10 per cent return for three years, risk free.
However, he asked for his money back a few days later, saying he regretted making the investment. While waiting for a response, the investor’s mother complained to the BCSC about the investment.
In addition to the fines, Zhang is prohibited for three years and Wang is prohibited for two years from:
• being a director or officer of any issuer or registrant
• being or acting as a registrant or promoter
• acting in a management or consultative capacity in connection with the securities market
• and engaging in promotional activities.
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