News Release

Vancouver – The Executive Director of the British Columbia Securities Commission (BCSC) has issued a notice of hearing alleging that a former mutual fund salesperson committed fraud when he persuaded a B.C. investor to unlock her pension funds to invest in a foreign exchange investment program, and did not forward her funds to be invested, but instead spent them with his girlfriend, in part on personal expenses..

The notice alleges that Robert Bruce Rush told the investor that she could use her locked pension funds to purchase a bond and then borrow money to invest using the bond as collateral. Rush, a resident of Vernon, B.C., also told the investor the scheme was tax-free. In 2008, the investor wrote a $73,200 cheque to Breakthrough Financial Inc. Rush was the sole director of Breakthrough.

BCSC staff contend that Rush told the investor her funds would be invested in a foreign exchange investment program offered by Francois Joseph Leon Michaud, an Alberta resident who the Alberta Securities Commission (ASC) permanently banned from the Alberta securities markets in 2011. In 2014, a BCSC panel reciprocated the ban and permanently banned Michaud from the B.C. capital markets.

Rush and Breakthrough did not forward the investor’s funds to Michaud, but instead Rush and his girlfriend spent the money in part on personal expenses. BCSC staff allege that Rush did not tell the investor that he would be keeping and spending the investor’s funds.

The CRA later reassessed the investor $35,000 due to the pension unlocking scheme, resulting in the investor having to remortgage her home. The investor’s funds are gone.

The notice also alleges that Rush engaged in unregistered trading, thereby breaching securities laws.

On February 2, 2014, the Mutual Fund Dealers Association of Canada (MFDA) found that Rush engaged in misconduct by contravening MFDA rules by selling off-book, inappropriate securities to clients, and by failing to cooperate with the MFDA investigation. Rush is seeking a hearing and review of the decision.

These allegations have not been proven. Counsel for the Executive Director will apply to set dates for a hearing into the allegations before a panel of commissioners on July 22, 2014 at 9:00am.

You may view the notice of hearing on our website, www.bcsc.bc.ca, by typing Robert Bruce Rush, Breakthrough Financial Inc., or 2014 BCSECCOM 241 in the search box. Information about disciplinary proceedings can be found in the Enforcement section of the BCSC website.

Please visit the Canadian Securities Administrators’ Disciplined Persons List for information relating to persons disciplined by provincial securities regulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of Canada (MFDA).

About the British Columbia Securities Commission (www.bcsc.bc.ca)

The British Columbia Securities Commission is the independent provincial government agency responsible for regulating capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and promote the public interest by fostering:

• A securities market that is fair and warrants public confidence

• A dynamic and competitive securities industry that provides investment opportunities and access to capital

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Media Contact:
Richard Gilhooley, Media Relations
604-899-6713

Public inquiries:
604-899-6854 or 1-800-373-6393 (toll free)

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