The last monthly Enforcement Roundup for 2023 features 5 enforcement actions taken by the BC Securities Commission (BCSC) and the Canadian Investment Regulatory Organization (CIRO). It also includes 8 new additions to the Investment Caution List.
BCSC Settlement Agreement
A Vancouver portfolio manager has paid $100,000 to the BCSC for failing to comply with investor protection requirements after a BCSC investigation revealed compliance deficiencies. Under the settlement, the firm’s head, Marcus (Ming) Xu, is prohibited from becoming or acting as a chief compliance officer of any investment market registrant for four years.
BCSC has ordered a halt in trading of Neotech Metals Corp., a Vancouver-based company traded on the Canadian Securities Exchange (CSE) due to unexplained and unusual fluctuations in trading volume and market price. Neotech’s 30-day average trading volume increased from 915, 295 before December 15, 2023 to 3.1 million between December 15 to December 20, 2023.
Neotech issued a news release stating that they are “unaware of any material change in the Company’s operations that would account for the recent increase in market activity.” The halt trade order will remain in effect until the end of January 8, 2024.
CIRO Decisions and Orders
A CIRO panel accepted a settlement agreement, with sanctions, for Canaccord Genuity Corp. Canaccord admitted that from January 2017 to March 2021 it failed to comply with its obligations to maintain a system of risk management, supervisory controls, policies and procedures that are designed to ensure compliance as it relates to market access by some of its direct electronic access clients.
Canaccord has agreed to a fine of $475,000 and to costs in the amount of $25,000.
A CIRO panel accepted an agreement, with sanctions, for Leede Jones Gable Inc. (Leede). Leede admitted to:
- Failure in supervising activities of Larry Martin, a Registered Representative at the time
- Deficiencies in compliance with the requirements set out under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act
- Failing to comply with the requirement of placing orders on a marketplace
Leede has agreed to pay a fine of $150,000 and pay costs of the proceeding in the amount of $15,000.
A CIRO panel found that between November 2018 and January 2020, Metcalfe engaged in fraudulent conduct with respect to loan financing and failed to attend an interview with CIRO Enforcement Staff thereby failing to cooperate with an investigation.
A separate hearing will be held to determine penalties.
BCSC Early Intervention
Investment Caution List
The BC Securities Commission’s Investment Caution List notifies British Columbians about unqualified investments and unregistered activity originating from outside of the province but accepts BC residents as clients.
Below are the December additions to our Investment Caution List:
AllCryptoCapital claims to be located in the UK and it also claims to offer accounts for trading in derivative contracts in forex, commodities, cryptocurrencies, and other financial instruments.
Coinbwys1.com, also operating as Coinbapps.com and Coinblines.com (collectively Coinbwys.1), claims to offer accounts for trading in cryptocurrencies and derivatives in cryptocurrencies.
P2B Cryptocurrency Exchange claims to operate an online cryptocurrency trading platform and we are aware that they accept British Columbia (BC) residents as clients.
Squire’s Finance Limited claims to be located in London, England and it also claims to offer trading in currency pairs, indices, commodities, metals, and stocks.
SwissWealth claims to offer investment services in cryptocurrency. We are aware that SwissWealth accepts BC residents as clients.
PolaxGroup claims to be located in Switzerland it also claims to offer CFD trading services in forex, stocks, commodities, and cryptocurrencies.
FundriseProX and FundrisePro claim to be located in Switzerland and they claim to offer trading services in cryptocurrencies.
Alpha Alliance Inc. claims to be located in Vancouver and Toronto and it also claims to offer trading services in cryptocurrency.
If you have 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 using BCSC’s online complaint form.
If you have information relating to fraud or serious market misconduct, you can securely submit tips through our Whistleblower program. Qualified tips may be eligible for cash rewards up to $500,000.