Enforcement Roundup – February 2018
In this edition of the Enforcement Roundup, we cover two British Columbia Securities Commission (BCSC) panel decisions and one notice of hearing. One Investment Industry Regulatory Organization of Canada (IIROC) settlement agreement is also included in this roundup.
BCSC Panel Decision
A BCSC panel fined and permanently banned Nickford from B.C.’s capital markets for fraud.
In August 2017, the panel found that Nickford convinced 13 investors to loan money to or invest in her company, Lynne Zlotnik Wealth Management (LZWM) in 2009 and 2010. Investors were told their funds would be used for LZWM’s business operations and growth.
The panel found that Nickford spent over $318,000 of the investors’ money on personal expenses unrelated to her business.
For her misconduct, Nickford has been ordered to resign any position she holds as a director or officer of an issuer or registrant. She has also been ordered to pay an administrative penalty of $300,000 and a disgorgement order of $318,141. Nickford is also subject to several market bans.
The panel permanently cease traded securities of LZWM.
A BCSC panel found that Bai and RBP Consulting committed fraud against nine investors for approximately $1.4 million.
Bai and RBP Consulting received $1,530,000 from investors who were told their funds would be invested in foreign exchange trading. The respondents deposited $129,000 in foreign exchange trading accounts and they used the rest of the investors’ funds for other purposes.
The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings.
BCSC Reciprocal Orders
A BCSC panel reciprocated enforcement orders against Wilson and Phillips. Both individuals were sanctioned by the Ontario Securities Commission.
BCSC Notice of Hearing
The Executive Director of the BCSC issued a notice of hearing alleging that Flexfi Inc., formerly known as CC Cornerstone Credit Ltd., and Afshin Ardalan distributed securities without a prospectus and without an available exemption from the prospectus requirement.
IIROC Settlement Agreement
In the settlement agreement, Hartner admitted to engaging in discretionary trading, excessive trading, and failing to know her product.
As a result of Hartner’s actions, her clients suffered losses in excess of $500,000.
Hartner agreed to a $40,000 fine, 18-month suspension from registration in any capacity, and 12 months of close supervision upon approval in any capacity with IIROC. She also agreed to pay costs of $5,000.
Report a Concern
If you have any concerns about a person or company offering an investment opportunity, please contact BCSC Inquiries at 604-899-6854 or 1-800-373-6393 or through e-mail at [email protected]. You can also file a complaint or submit a tip anonymous using BCSC’s online complaint form.