Ming Chao Zhao, also known as Michael Zhao, was ordered to pay a $750,000 administrative penalty, $30,000 in costs and return $416,719 of profits.
"Our insider trading and market abuse team is establishing momentum in detecting and pursuing cases of illegal insider trading," said Tom Atkinson, director of enforcement at the Ontario Securities Commission.
"We are pleased with the results so far and will continue to focus on cases where individuals misuse confidential information for their own personal gain".
Under the settlement, Zhao was permanently banned from trading securities and from becoming a registrant, or a director or officer of a registrant. He was also banned from becoming a director or officer of an issuer for 10 years.
The regulator says between June 2010 and December 2011, Zhao used a relative's brokerage account to buy shares of five companies that, because of his position at BMO, he knew were going to announce merger and acquisition deals.
The companies included Menu Foods Income Fund, which was acquired by Simmons Pet Foods, Consolidated Thompson Iron Mines Ltd., which was bought by Cliffs Natural Resources, and Forzani Group Ltd., which was bought by Canadian Tire.
Zhao also bought shares of Pacific Northern Gas Ltd. before it was acquired by AltaGas and shares of Canmarc Real Estate Investment Trust before it was bought by Cominar.
After the announcements he sold the shares, earning a profit of roughly $416,000.