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A senior executive at BMO Capital Markets has faced termination following a significant regulatory penalty imposed on the bank. The decision comes in the wake of an investigation into misleading marketing practices concerning mortgage-backed securities. Doo Sik Lew, a managing director overseeing the US mortgage-backed bond desk, was relieved of his duties last month as part of this development. This action aligns with ongoing scrutiny from financial regulators and underscores the bank's commitment to addressing supervisory failures. While the exact circumstances surrounding Lew's dismissal remain undisclosed, it is clear that the incident ties into broader concerns about the integrity of mortgage-backed securities transactions within the firm.

According to records filed with the Financial Industry Regulatory Authority (FINRA), Doo Sik Lew has been cooperating with the investigation but disputes the allegations made against him. He first became involved with regulators in September 2023, marking the beginning of an inquiry into potential deceptive structuring and marketing practices. Lew brings nearly two decades of industry experience to the table, having spent six years at BMO. Despite his extensive background, the allegations have led to his recent departure from the company.

The US Securities and Exchange Commission (SEC) had previously indicated its intention to take enforcement action against Lew. Although BMO declined to comment on personnel matters, the bank recently resolved a separate SEC investigation by agreeing to a settlement exceeding $40 million. This settlement included returning $19.4 million in profits to affected parties, paying a civil penalty of $19 million, and covering $2.2 million in interest. The bank maintained that it neither admitted nor denied the allegations during the settlement process.

In light of these events, BMO has reaffirmed its dedication to maintaining high standards of ethical conduct. The bank emphasized its continuous efforts to enhance controls and supervisory frameworks. While the connection between Lew's case and the broader SEC investigation remains unclear, BMO expressed satisfaction in concluding the matter. The bank's spokesperson highlighted the importance of transparency and accountability in its operations, signaling a renewed focus on compliance and oversight.