BC Securities Enforcement Roundup – January 2014
In January, the BC Securities Commission issued three enforcement decisions, issued an Investor Alert about Binary Options Trading Platforms and a news release about reciprocal orders against 18 individuals. The Investment Industry Regulatory Organization of Canada (IIROC) released two decisions and one settlement in January relating to BC residents. The Mutual Fund Dealers Association did not release any decisions or settlements during January relating to BC residents.
You can find a summary of some of the recent matters below.
A BCSC panel permanently banned Mesidor from the province’s capital markets. The panel fined Mesidor $75,000 and ordered him to pay the $16,000 he obtained from investors as a result of his misconduct.
In October 2013, a BCSC panel found that Mesidor committed fraud and prepared and delivered false and misleading financial statements to investors.
A BCSC panel banned both Bass and Zucchet from the province’s capital markets for five years. The panel fined Bass $10,000 and Zucchet $15,000. Bass must also pay the $21,500 he obtained from investors as a result of the illegal activity. Cinnabar was permanently cease traded.
In September 2013, a BCSC panel found that Bass and Zucchet illegally sold shares of Cinnabar to seven investors.
A BCSC panel varied IIROC’s penalty decision by replacing the original penalties with a fine of $100,000, disgorgement of commissions of $6,813, and costs of $20,000.
In August 2013, a BCSC panel upheld an IIROC panel’s decision that Steinhoff breached IIROC’s suitability rules.
An IIROC panel fined Chang $100,000 and ordered costs of $7,500. The panel also permanently banned Chang from IIROC registration.
The panel imposed these sanctions after finding in an earlier August 2013 decision that Chang made unauthorized purchases in a client account and then made misrepresentations to the client regarding the number of shares held in the account.
An IIROC panel found that Jones engaged in discretionary trading, made unsuitable recommendations in a client’s account, and misrepresented information to the client. A hearing on sanctions will be held at a later date.
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