The August edition of the Enforcement Roundup features the latest enforcement news from the BC Securities Commission (BCSC) and the Canadian Investment Regulatory Organization (CIRO). It also includes 9 new additions to the Investment Caution List.
BCSC Settlement Agreement
From January 2017 to December 2019, Schramm accepted trading authority for 29 clients’ investment accounts while unregistered under the Securities Act. Schramm consulted clients, conducted trades, updated them on their portfolios, and received payments that amounted to 1% of the total annual value of their portfolios.
As part of the agreement, Schramm paid $20,000 to the BCSC and is prohibited from conducting certain activities in the investment market for 20 years.
Vertex One Asset Management Inc., its former chief compliance officer (Lang), and a former director (McCord) agreed to pay $300,000 after a BCSC examination revealed that their firm provided improper incentives to dealer representatives and lacked adequate system of control and supervision.
Vertex clients were not charged increased fees as a result of the improper incentives. Vertex ceased operations on its own in 2021 while McCord and Lang applied to surrender their respective registrations that same year.
A hearing panel found that Spooner accepted monies directly from the issuer, not his Dealer Member, and proceeded with a private placement for individuals and entities not clients of his Dealer Member.
As a result, sanctions were imposed on Spooner.
CIRO Decisions & Reasons
From February 2018 to April 2019, Lidder implemented a short-term investment strategy while employed at a Vancouver branch of BMO Nesbitt Burns. The strategy involved purchasing a selected security at the beginning of each week and selling it at the end of it.
A CIRO hearing panel outlined its findings of misconduct and confirmed sanctions imposed on Lidder, including a fine in the amount of $15,000 and costs in the amount of $2,500.
BCSC Early Intervention
The BCSC takes a proactive approach in early intervention. Our Investment Caution List notifies British Columbians about unqualified investments and unregistered activity originating from outside of the province that accept BC residents as clients.
Below are the August additions to the Investment Caution List:
Investus Pro claims to be located in Canada and the United Kingdom. It also claims to offer trading services in commodities, forex, and indices.
TopShark claims to have an office in Toronto, Ontario. It also claims to offer trading services for forex, indices, commodities, crypto, stocks, and bonds.
Voltcoins claims to be located in Lithuania. It also claims to offer an online cryptocurrency trading platform and we are aware that Voltcoins accepts BC residents as clients.
Viptrademining claims to offer an online cryptocurrency trading platform and we are aware that Vitrademining accepts BC residents as clients.
The Revenue Center Pro claims to offer trading services in Contracts for Difference (CFD) and other financial products.
Spextrade claims to be located in Kentwood, Michigan. It also claims to offer cryptocurrency trading services.
Finflow-x claims to be located in Switzerland and it also claims to offer trading services for forex, indices, commodities, crypto, and NFTs.
Imperial Invest claims to be located in the United Kingdom and it also claims to offer trading services in forex, shares, indices, bonds, and cryptocurrencies.
Bitmarket-Capital claims to be located in Toronto, Ontario and it claims to offer accounts for trading in cryptocurrencies.
Report a Concern
If you have any concerns about a person or company offering an investment opportunity, please contact BCSC Contact Centre at 604-899-6854 or 1-800-373-6393 or by e-mail at [email protected]. You can also file a complaint or submit a tip anonymously using the BCSC’s online complaint form.