Enforcement Roundup – October 2018

Enforcement Roundup – October 2018

In this edition of the Enforcement Roundup, we cover two British Columbia Securities Commission (BCSC) settlement agreements and three findings decisions. We also summarize settlement agreements from the Mutual Fund Dealers Association of Canada (MFDA) and the Investment Industry Regulatory Organization of Canada (IIROC).

BCSC Settlements

Carl Vance Loeber

The BCSC reached a settlement agreement with Loeber, the president and a director of Nickel One Resources Inc., a junior mineral exploration company that filed a deficient technical report. Nickel One Resources Inc. shares are listed on the TSX Venture and Frankfurt exchanges.

Loeber has agreed to undertake further training and education with respect to the requirements of NI 43-101 and the duties and responsibilities of directors and officers of public companies. He must complete the courses of study by September 28, 2019 and provide proof in writing of attendance and successful completion to the BCSC Executive Director.

News Release

Les Weinstein

The BCSC reached a settlement agreement with Weinstein who traded securities without registration when he purchased shares in a private placement for investors.

Weinstein has agreed to pay $5,000 to the Commission and he is prohibited from acting as a registrant or promoter and from engaging in investor relations activities until the later of two years or until he has paid the Commission.

News Release

BCSC Findings Decisions

Alan and Jerry Braun, and Steven Maxwell (a.k.a. Steven Fassman)

A BCSC panel found that Alan and Jerry Braun, both Surrey residents, and Maxwell, a White Rock resident, committed fraud against two people in a real estate-related investment scheme.  The panel also made fraud findings against three corporate entities  – Braun Developments (B.C.) Ltd., 0985812 B.C. Ltd. (TerraCorp Investment Ltd.), and 8022275 Canada Inc.

“In each case, the prohibited act or deception clearly resulted in the risk of deprivation and, ultimately, actual deprivation to the investors,” the panel said in its findings.

The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings. You can read more about this findings decision in the news release.

News Release

Brent Hugo Johnson and Mountainstar Gold Inc.

A BCSC panel has found that Johnson and Mountainstar Gold Inc. made repeated false or misleading statements in required public filings. Johnson was at all relevant times the president, CEO, and a director of Mountainstar.

The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings. You can read more about this findings decision in the news release.

News Release

Matthew John Hamilton

A BCSC panel found that Hamilton’s conduct with respect to creating a publicly trading shell company was abusive to BC’s capital markets.

The BCSC panel found it in the public interest to make orders against Hamilton, a resident of Vancouver, for his deception of securities regulators, capital markets gatekeepers, and the public about the true ownership and control of Guru Health Inc., a company that traded on the OTC Bulletin Board (OTCBB) in the United States. The panel also dismissed allegations against his co-respondent, Braeden William Sinclair Lichti (a.k.a. Braeden Sinclair), also a Vancouver resident.

“Hamilton’s conduct was so egregious and raises such concern for the investing public and the integrity of our capital markets that it was clearly abusive,” the panel said in its findings.

The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings. You can read more about this findings decision in the news release.

News Release

MFDA Settlement Agreement

James Brewes Scholes

In the settlement agreement, Brewer admitted that he contravened an MFDA rule when he obtained, possessed, and, in some instances, processed transactions using pre-signed account forms. He also admitted to contravening the same rule when he falsified account forms to process transactions by altering the client account forms without having the clients initial the alterations.

Scholes must pay a fine of $11,000 and costs of $2,500, and comply with the MFDA rule he admitted to contravening in the settlement agreement.

IIROC Settlement Agreement

Pei-Ying Patty Chen

In the settlement agreement, Chen admitted that she failed to disclose outside investment accounts to her employer – contrary to an IIROC dealer member rule.

Chen must pay a fine of $15,000 and costs of $2,500. She must also re-write and pass the Conduct and Practices Handbook course prior to any re-registration with IIROC.

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 anonymously using BCSC’s online complaint form.

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