CIRO ruling adds $530k fine and costs to advisor’s fraud guilty plea
A former Orillia advisor who admitted to defrauding 25 clients out of more than $1.8m has now been permanently shut out of the securities industry by the Canadian Investment Regulatory Organization.
According to CIRO’s hearing panel, Kevin Douse misappropriated or otherwise failed to account for about $277,172.52 from five Quadrus Investment Services Ltd. clients and two other individuals between January 2018 and October 2020.
He then failed to cooperate with CIRO staff investigating his conduct under the Mutual Fund Dealer Rules.
The panel imposed a permanent prohibition on him conducting securities related business with any CIRO Dealer Member, a global fine of $530,000, and $30,000 in costs.
CIRO says the violations occurred while Douse was a Registered Dealing Representative with Quadrus in the Orillia area and notes that he is not currently registered in any capacity.
The panel found that clients and other individuals wrote cheques they believed were funding Tax Free Savings Accounts, Registered Retirement Savings Plan accounts or other investments at Quadrus—often payable to “Quadrus,” “Kevin Douse – Quadrus” or “Kevin Douse”—and that Douse deposited those cheques into his personal bank accounts instead.
CIRO says he then tried to cover his tracks by issuing bank drafts from his accounts when clients requested “redemptions” and by providing fabricated account statements and portfolio summaries that falsely showed holdings at Quadrus.
CIRO describes misappropriation of client money as “one of the most egregious forms of misconduct in the securities business” and says Douse’s conduct formed a sustained pattern, involved multiple victims and at least one vulnerable client, and seriously harmed confidence in the industry.
CIRO also found that Douse did not meet his obligation to cooperate with its investigation.
Senior Investigator Patricia West repeatedly requested a written response and an interview, including a formal demand that he attend to give a statement under oath, but CIRO says Douse either failed to respond or ultimately refused to appear, with his counsel citing ongoing civil proceedings.
The panel held that an Approved Person’s legal strategy does not override the duty to cooperate under Mutual Fund Dealer Rule 6.2.1 and said his refusal, coupled with his failure to attend the first two days of the hearing, showed he was ungovernable by the regulator.
The regulatory outcome follows a related criminal case.
CIRO says Douse pleaded guilty in the Ontario Court of Justice on September 19, 2025, to one count that between October 3, 2016 and November 20, 2023 he “did by deceit, falsehood or other fraudulent means, defraud the public of monies which exceeded the sum of $5,000,” under section 380(1)(a) of the Criminal Code.
In an Agreed Statement of Facts, he admitted using his role as a financial advisor to misappropriate more than $1.8m from 25 victims, including those in the CIRO matter.
CIRO reports that he is scheduled for sentencing on February 5 and that, based on the plea transcript, he appears likely to face a custodial term.
Wealth Professional reports that the Crown told the court Douse “repeatedly lied to his victims, forged numerous documents and signatures, impersonated his victims, and directed several unauthorized transactions.”
It added that police arrested him in April following a 16‑month investigation and charged him with defrauding the public of funds over $5,000 and with 11 counts of uttering a forged document.
CTV News reports that Douse told the CIRO panel, “I know I have forever devastated many people,” and, “I can’t undo what I’ve done, but I can continue taking responsibility, remain committed to my treatment, and keep working to make restitution.”
He asked that costs not be imposed, saying he wants restitution paid and claims to have no funds or assets.
CIRO says the panel weighed the need for specific and general deterrence.
It rejected a higher fine of up to three times the profit from the violations and instead imposed a $530,000 global fine it viewed as proportionate to the misconduct and mindful of the parallel criminal and civil consequences.
CIRO records that Staff told the panel they do “not intend to stand in front of a complainant who is being repaid by the Respondent,” and the panel said it shared the concern that fines and costs should not interfere with restitution to victims.
