CEO Douglas John Vermeeren accused of fraud and misleading investors

Serious accusations of fraudulent conduct concerning his company, Monthly Millionaire Mentor Ltd., have been made against Douglas John Vermeeren, the CEO of Millionaire Training Systems and self-described author, film producer, and wealth management specialist.

The claims are based on a cease-trade order that was placed against Vermeeren and his company, which forbade them from dealing in Monthly Millionaire Mentor securities. Notwithstanding these limitations, it is asserted that Vermeeren entered into loan agreements with multiple investors, allegedly obtaining $1.3 million. Vermeeren is suspected of misleading investors by representing investments as loans for a variety of projects, including the making of films. These transactions are purported to have occurred in March 2013.

Additionally, Vermeeren is charged with embezzling investor monies for his benefit or to reimburse other investors for their investments. He also reportedly made misleading statements about the level of risk associated with investments, his track record of success, and the quantity of money he managed on behalf of clients.

For Vermeeren to respond to these charges, a hearing has been set by the Alberta Securities Commission (ASC). The ASC claims that Vermeeren proceeded to collect money from investors in defiance of the temporary cease trade order, which prompted an additional investigation into his conduct.

By marketing himself as an expert in wealth planning and emphasizing his appearances on television networks, Vermeeren has made an effort to uphold his credibility through his web presence. All the same, he is accused of misrepresenting himself in his writings, deceiving investors, and mismanaging investment capital.

Due to the accusations made against him, Vermeeren’s reputation and business dealings are generally under close examination, and he may face major legal consequences.

Claims Made by Workers of the Ontario Securities Commission  

• Douglas John Vermeeren (“Vermeeren” or the “Respondent”) and the Alberta Securities Commission (the “ASC”) signed a Settlement Agreement and Undertaking on June 14, 2016 (the “Settlement Agreement”).

• The following is a summary of the Settlement Agreement and Undertaking that Douglas John Vermeeren (“Vermeeren” or the “Respondent”) and the Alberta Securities Commission (“ASC”) signed on June 14, 2016 (“Settlement Agreement”).

• As per the terms of the Settlement Agreement, Vermeeren committed to several tasks and accepted to be subject to obligations, conditions, and/or consequences within the province of Alberta.

• Vermeeren consented to specific obligations and the imposition of sanctions, conditions, limitations, or requirements within the Alberta province as outlined in the Settlement Agreement.

• By paragraph 5 of subsection 127(10) of the Ontario Securities Act, RSO 1990, c S.5 (the “Act”), the staff is requesting an inter-jurisdictional enforcement order that would reciprocate the Settlement Agreement. 

The Proceedings of the ASC 

Agreement Information

The following facts were accepted by Vermeeren in the Settlement Agreement:

Participants

In Calgary, Alberta, the respondent resides. Monthly Millionaire Mentor Ltd. (“MMM”), a company domiciled in Calgary, has the Respondent as its sole director and officer at all relevant times. 

Conditions

• The Respondent engaged in loan agreements (the “Loan Agreements”) with at least forty-three investors from Alberta and other parts of Canada between December 2011 and April 2014; some of these agreements were backed by promissory notes. The Respondent raised almost $735,000 per the terms of the loan agreements.
• Interest rates on the Loan Agreements ranged from 7% to 10% over terms of 3 to 24 months. The Loan Agreements named MMM, one of the Respondents, or Business Boost, the Respondent’s business name, as the “Borrower.”
• Some investors received periodic updates on their “Investment Reports” from the Respondent. The Total Amount of Returns on Each Investment, along with details about the “investment description,” “investment date,” and “investment amount,” were all included in the Investment Reports.
• Investors knew their money was going to be used to provide loans to other people, primarily small companies. In the Investment Reports, these loans were referred to as “venture capital lending.”
• In addition to handling their money and interacting with them regarding their investments, the Respondent met with investors and made presentations to potential investors.
• Money was given to the Respondent by investors so that the Respondent might make money through “venture capital lending” or lending to other people. Investors expected the Respondent to make every effort to fulfill its obligations to pay interest on the funds that were supplied to it. Investors were under no need to contribute to the profits in any way, other than to provide the Respondent their investment money.
• Presenting to prospective investors, meeting with investors, managing their funds, and keeping in touch with investors about their investments were all done by the respondents.
• Investors gave money to the respondent, which the respondent utilized for “venture capital lending,” or lending to third parties in an attempt to make money. The investors anticipated that the respondent would exert the necessary effort to fulfill the commitments made to pay interest on the funds provided to the respondent. Other than giving the Respondent their investment monies, investors were not obliged to do anything to aid in the profit generation. It was intended for the venture capital lending to be a shared enterprise, with investors heavily depending on the Respondent’s efforts to generate the anticipated returns.
• Since the venture capital loan was to be a shared operation, investors mostly depended on the Respondent’s efforts to realize the projected gains.
• Under the definition of these terms provided by the Alberta Securities Act, RSA 2000, c S-4 (the “Alberta Act”), the investments mentioned above qualified as trades in securities. Furthermore, the Respondent represented himself or his activities as being in the business of dealing securities or exchange contracts. The fact that these securities had never been issued previously made these trades eligible as dividends under the Alberta Act.
• Under Alberta securities laws, neither MMM nor the Respondent has a dealer registration at any pertinent time.
• Neither a preliminary nor a final prospectus had been submitted to or accepted by the ASC’s Executive Director at the time of the trades mentioned above. 

Deceptive Claims

The Respondent stated things about one or more investors that he knew to be untrue or misleading. According to the respondent:

• The money invested would be used for “capital lending” or “venture capital lending”; additionally, the respondent assured investors that their money was “guaranteed” and that there were no risks associated with the investment. Finally, the respondent never experienced a loss on behalf of investors.

The respondent made the following assertions knowing they were false or misleading, or should have known they were, as stated in the paragraph above:

• A part of the money invested was utilized to reimburse previous investors or to cover the respondent’s costs.
• The claim that there was no risk or assurance associated with the transactions and that certain investors lost all or part of their money invested with the Respondent, was unfounded. 

Fraud

• The respondent directly or indirectly engaged in securities-related activities, practices, or courses of behavior that he knew or fairly ought to have known would defraud investors. Fraudulent activity by the Respondent includes mixing investor funds into its account and corporate accounts. These accounts funded personal expenses and investor payments. Because the Respondent did not retain appropriate accounting records, it was difficult to identify the extent of investor fund fraud.
• Investor funds financed third-party lending. 

Violating the Order of the Alberta Securities Commission

• An interim cease-trade order (the “ICTO”) was issued by the ASC against MMM and the Respondent on March 14, 2013. The ICTO was given an extension “until a decision is made and an enforcement proceeding in this matter is concluded.”

• The Respondent violated the ICTO by raising money from more investors. 

Agreement

Vermeeren agreed to specified commitments and Alberta-specific sanctions, limitations, limits, or requirements. Vermeeren pledged:

• Give the ASC $120,000 in total to settle all of the allegations made against him, plus an additional $10,000 to defray the investigation’s expenses.

• Pay the ASC $120,000 to settle all allegations and $10,000 for investigation fees.
• Ten years following the execution of the Settlement Agreement, the Respondent shall refrain from purchasing or disposing of securities or derivatives; however, he may still purchase or sell exchange-listed securities in his capacity or for the benefit of his family through a registrant in one or more family or personal accounts held with that registrant.

• Stop buying and selling securities or derivatives for ten years after the Settlement Agreement’s execution, but the Respondent can still buy or sell exchange-listed securities in his capacity or for his family through a registrant in one or more personal or family accounts.
• Stop serving as a director or officer of any lender, registrant, or investment fund manager in Alberta or elsewhere in Canada for 10 years. He may, nevertheless, carry on serving as an officer or director of any issuer that does not presently or in the future intend to offer securities for sale to the general public.

• He can remain a director or officer of any issuer that does not issue or plan to issue securities. 

• The Executive Director of the ASC, or his designee, must enter into or accede to, and induce his spouse to enter into or consent to, any other agreements or paperwork needed to orderly pay the $130,000. 

Conclusion

Finally, Millionaire Training Systems CEO Douglas John Vermeeren has been in deep legal difficulty due to fraud claims against Monthly Millionaire Mentor Ltd., his company. The allegations against Vermeeren include deceiving investors, taking their money, and making false statements regarding investments, as well as breaking a stop-trading order that was placed on his company.

In response to these claims, a hearing has been set up by the Alberta Securities Commission (ASC). In a Settlement Agreement and Undertaking, which Vermeeren has signed, he agrees to several terms and obligations. Financial fines, limitations on trading securities, and the removal of director or officer titles are all examples of such restrictions.

Financial penalties and limitations on Vermeeren’s commercial activity are among the severe repercussions of his conduct. He faces very serious accusations, and the regulatory response to his actions is reflected in the Settlement Agreement. From a business and reputational standpoint, Vermeeren has taken a major hit from these legal procedures.

Source: Intelligenceline.com

James Smith