InvestRight By BCSC
humburger icon
close icon
News & Insights

Enforcement Roundup: February 2019

Enforcement Roundup gavel resting on a desk
The Enforcement Roundup is a monthly summary of enforcement activities in British Columbia taken by securities regulators.

In this edition of the Enforcement Roundup, we cover two British Columbia Securities Commission (BCSC) panel decisions and the receipt of administrative penalties. We also cover a Mutual Fund Dealers Association of Canada (MFDA) reasons for decision, and an Investment Industry Regulatory Organization of Canada (IIROC) supplemental imposition of penalties.

BCSC Enforcement

BCSC Sanctions

Alan Braun, Jerry Braun, Steven Maxwell (aka Steven Fassman)

A BCSC panel imposed financial sanctions and market bans on Alan and Jerry Braun, Maxwell and three companies after having found that they committed fraud.

A BCSC panel found that the Brauns, Steven Maxwell (a.k.a. Steven Fassman), and the companies they controlled – Braun Developments (B.C.) Ltd., 8022275 Canada Inc. and 0985812 B.C. Ltd (d/b/a TerraCorp Investment Ltd.) – took $450,000 from two investors in three different transactions.

The panel ordered that Maxwell and Alan Braun pay $120,500 and $323,500, respectively, which are the amounts that they obtained from the fraud. The panel also ordered that J. Braun and Braun Developments be liable for approximately $157,000 of the $323,500 order made against Alan Braun.

In addition, the panel imposed administrative penalties of $450,000 against Alan Braun, $300,000 against Maxwell, and $200,000 against Jerry Braun for their misconduct.

The panel also imposed bans on various market activities by the three men; and permanently banned anyone from trading in the securities of the corporate respondents.

Read the news release for full details.

News Release

Bossteam E-Commerce Inc.

The BCSC received $4.8 million in administrative penalties from two former Burnaby residents, who defrauded hundreds of investors in a Ponzi scheme.

The payment comes after court-appointed receiver – Grant Thornton Limited – distributed about $6.5 million to 464 people who lost money by investing in Bossteam E-Commerce Inc.  Every investor with a validated claim was reimbursed for their total losses, plus 5 per cent interest.

The administrative penalty payments mostly came from funds that remained in the frozen bank accounts of Bossteam co-founders, Yan Zhu (a.k.a. Rachel Zhu) and Guan Qiang Zhang. The BCSC froze the accounts during the investigation.

Read the news release for full details.

News Release

BCSC Decisions

James Marc Gravelle and WY ATAP Investments Inc.

A BCSC panel dismissed allegations that Gravelle and WY ATAP Investments Inc. violated the B.C. Securities Act by guaranteeing repayment of promissory notes and by issuing promissory notes without being registered.

The panel also ruled that Gravelle and WY’s conduct qualified for an exemption from the requirement to be registered to trade in securities and therefore they did not violate the Securities Act in issuing the promissory notes.

Read the news release for full details.

News Release

MFDA Enforcement

MFDA Reasons for Decision

Harold Magnus Backer

On February 8, 2019 an MFDA panel released its reasons for a decision in connection with Backer’s disciplinary decision.

In its reasons for the decision, the panel confirmed the sanctions imposed on Becker, which are: a fine of $2,745,261.34; costs of $17,875; and, a permanent prohibition from conducting securities related business in any capacity while in the employ of, or in association with, any MFDA Member.

Read the news release for full details.

News Release

IIROC Enforcement

Alberto Tassone

Tassone had provided misleading information to IIROC staff with respect to certain matters relating to his involvement in the Investment.

An IIROC panel imposed a supplemental penalty on Tassone following a hearing. They are:

  • a fine of $103,648, which includes a disgorgement from financial benefits of unauthorized outside business activity
  • an administrative fine of $35,000; and,
  • a six month suspension from registration in any capacity with IIROC (in addition to the six months imposed in the Hearing Panel’s penalty decision dated December 26, 2017).

Tassone is also required to pay costs in the amount of $40,000. These penalties are in addition to those imposed in the panel’s 2017 decision.

Read the news release for full details.

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 the BCSC’s online complaint form.

InvestRight.org is the British Columbia Securities Commission’s investor education website. Subscribe to receive email updates from BCSC InvestRight.

More Resources

Your Role When Working with an Advisor

Your Role When Working with an Advisor

The client-advisor relationship is a two-way street, and it’s important to know what your responsibilities are.

Read More
Enforcement Roundup: February 2019

Enforcement Roundup: February 2019

The Enforcement Roundup is a monthly summary of enforcement activities in British Columbia taken by securities regulators.

Read More