(Michael Ruge outside North Cowichan municipal hall on Nov. 19, 2025)
Michael Ruge's $150,000 fine for defrauding investors ‘remains unpaid’ two decades later
Ruge ran unsuccessfully for North Cowichan council, donated $750 to Tek Manhas campaign
Michael Ernst Ruge turned up unexpectedly at North Cowichan municipal hall last week. And sixmountains.ca seized the opportunity to ask why — after 20 years — he still hasn’t paid his $150,000 fine to the BC Securities Commission for fraud and illegally distributing securities to investors.
Ruge insisted there is no longer a fine to be paid. “It was all wiped out legally by the commission,” he said. “They wiped out the fine.” He said it happened around “2009, 2010, I’m not sure exactly when.”
But that’s not the commission’s position. Far from it.
The commission’s “administrative penalty against Mr. Ruge remains unpaid,” Brian Kladko, manager of media relations and public affairs, said Wednesday in a written statement to sixmountains.ca.
“…he has paid only $5,000 of the $150,000 penalty; that $5,000 payment was made upon signing the settlement agreement.”
Kladko said Ruge filed for bankruptcy. “He was given a conditional discharge from bankruptcy in 2015, conditional upon his paying $150,000 to the bankrupt estate, which he hasn’t done.
“So he remains an undischarged bankrupt. We continue to pursue the uncollected amount.”
The 2005 settlement agreement with the commission is a document agreed to by Ruge and Chivas Hedge Fund Ltd. (of which Ruge was the sole shareholder and director) providing for the $150,000 penalty and a 25-year ban from the securities market.
Ruge ran for office in North Cowichan in 2011, placing last among 17 candidates for council with 381 votes.
During the 2022 municipal election, Ruge donated $750 to councillor Tek Manhas’ election campaign, while his wife, Elly Ruge, donated $1,250, the maximum allowable.
Manhas has not responded to a request for comment.
(Councillor Tek Manhas)
Outside municipal hall on November 19, Michael Ruge told sixmountains.ca: “I’ll donate to any councillor that is pro development.”
Asked what brought him to the 5 pm council meeting, he said: “To see what’s going on.” Then he proceeded towards the council chambers.
The settlement agreement references an "offering memorandum Oct. 1, 2001, for an exempt private offering of 400,000 Partnership Units at $50 per unit to residents of BC, Alberta, and Ontario."
From Dec. 18, 2001, to Feb. 6, 2003, 50 investors purchased $1,543,919 units under the memorandum. Ruge also raised funds from US investors.
About $243,402 was refunded to investors, the agreement states, “but there is little prospect of any additional recovery. The Investors have lost most of their money.”
The settlement agreement lists several misrepresentations by Ruge, including:
— Chivas was a hedge fund when it was not.
— He monitored the advisors’ performance closely when, instead, he did nothing in that regard.
— He had “cream of the crop people” in place in the New York office when, in fact, Chivas did not have any New York employees.
— Investors could get their money back at any time, when the offering memorandum in fact did not provide for early redemption.
— Chivas had a rate of return of between 26% to 45%, which was not true. Rates of return were not calculated on a reliable basis, as there was no consideration of expenses, of whether shares held by Chivas were free trading or liquid, or if loans held by Chivas were being repaid or were recoverable.
In the agreement, Ruge promised not only to pay the $150,000 but “not to say anything, in writing or orally, which may contradict the terms of this settlement or call those terms into question.”
Read the agreement: https://www.bcsc.bc.ca/enforcement/administrative-enforcement/settlements/2005/michael-ernst-ruge-et-al-sec-161--settlement-agrmnt
On various websites, Ruge has described himself as a business consultant, eco-advisor and author.
“I am a deal maker who gets things done,” he writes. “As an ‘entrepreneur’ I have created several, successful enterprises. As an ‘intrapreneur’ I have advised and lent my consulting expertise to all sizes of corporations and entities, resulting in multiplying the third bottom line (people, planet, profits).
“I live my life by my standards and my way, attacking challenges as they come up. Good-natured, happy, peaceful man, always willing to help. High energy. The guiding light for my family and loved ones, friends and clients, an incredible supporter, doing the right thing. I am an adventurer, a world traveler, a seeker of new limits.”
Read more on the struggle to collect money from fraudsters: https://vancouversun.com/news/bc-financial-regulator-makes-another-attempt-to-collect-on-fraudsters-36-7-million-in-penalties
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— Larry Pynn, Nov. 28, 2025