The February Enforcement Roundup features 8 enforcement actions taken by the BC Securities Commission (BCSC) and the Canadian Investment Regulatory Organization (CIRO). It also includes 17 new additions to the Investment Caution List.
BCSC Enforcement
BCSC Settlement Agreements
County Line Energy Inc., 0985358 B.C. Ltd., Aarif Jamani, and 1207124 B.C. Ltd.
A BC resident and three companies connected to him have admitted to breaching a cease trade order issued by the BCSC. County Line Energy Inc., a BC reporting issuer and Nevada corporation, issued 23 debt securities totalling nearly US$97,000 in violation of a 2013 cease trade order. Two BC numbered companies (0985258 BC Ltd. and 1297124 BC Ltd.) also sold more than 18 million shares in County Line in the same time period.
Aarif Jamani – sole director of 0985358 at the time – authorized, permitted, or acquiesced the company’s misconduct, ignoring warnings from the BCSC that his actions were in breach of a cease trade order. Jamani has paid $40,000 and Country Line paid $10,000 to the BCSC as part of a settlement agreement. They are also prohibited from participating in the public markets for 4 years.
Read the news release for full details.
Justin Edgar Liu, Lukor Capital Corp., and Asiatic Management Consultants Ltd.
A West Vancouver man (Liu) and two companies he controlled (Lukor and Asiatic) have admitted to participating in a scheme that involved private placements and prepaid consulting fees that was abusive to the investment market.
As part of the scheme, Liu, the companies, and other consultants entered into consulting agreements with issuers listed on the Canadian Securities Exchange (CSE). Although they did little to no consulting work, they used their role as consultants to purchase tradeable shares of the issuers. Liu, Lukor, or Asiatic also received a total of $4.5 million in prepaid consulting fees from nine issuers.
Read the news release for full details.
John Michael Wisbey
The CEO and director of the BC-based International Lithium Corp., has paid $80,000 to the BCSC. Wisbey, a resident of Switzerland, failed to accurately disclose his trades and shareholdings, failed to provide advance notice of his intention to distribute securities, and made false or misleading statements in a required filing.
In addition to financial sanctions for his misconduct, Wisbey has made the required System for Electronic Disclosure by Insiders (SEDI) filings and paid late fees of $18,750.
Read the news release for full details.
BCSC Sanctions
Jeffrey Shaughnessy
A BC Securities Commission panel has permanently banned a convicted Vancouver fraudster from participating in the investment market. In 2017, Shaughnessy convinced two couples to invest in an opportunity that he said was a Magic Johnson speaking event at the Park Hotel.
Two couples cumulatively invested $29,000. Shaughnessy used the funds towards personal expenses, including at a casino. Shaughnessy has since pleaded guilty in provincial court for the Criminal Code offence of obtaining credit by false pretence or fraud.
Read the news release for full details.
BCSC Decisions and Findings
BLOK Technologies Inc. And James Joseph Hyland
A Vancouver-based blockchain technology investment company (BLOK Technologies Inc. previously known as Aida Minerals Corp.) was found to have made misrepresentations when it failed to disclose that it spent, or planned to spend, proceeds from a private placement on consultants.
The company published a false or misleading news release which said that the company raised $5.4 million but did not disclose that $4.4 million would go towards consulting fees. Instead, the news release indicated that the private placement would be spent on advancing blockchain investment projects, evaluating new blockchain opportunities, and working capital.
Read the news release for full details.
CIRO Enforcement
CIRO Sanctions
Donald Warren Metcalfe
A previous hearing found that Metcalfe engaged in fraudulent conduct by making false representations as to the ownership of and as to the value of assets offered as collateral to secure a $172 million loan financing. In addition, he also failed to attend an interview with Enforcement staff and refused to cooperate with an investigation.
As a result, CIRO imposed a fine of $2,500,000 and a permanent bar to approval in any capacity. He is also required to pay costs in the amount of $68,908.
Read the news release for full details.
Mei-Hui Bobb
A CIRO panel found that Bobb, who carried on business in Surrey, photocopied signature pages from account forms that had been signed by clients and re-used them to complete seven additional account forms. She also altered and processed transactions for 18 accounts with respect to 15 clients by altering information without having the client initial the alterations. She was also found to have processed transactions of 17 pre-signed account forms in respect of six clients.
Following the hearing, CIRO imposed a suspension from conducting securities related business while associated with any Dealer Member of CIRO and a fine of $28,000. Bobb was also required to pay costs in the amount of $5,000.
Read the news release for full details.
Graham Darren Moore
A CIRO panel found that Moore, a Registered Representative with the Vancouver branch of Haywood Securities Inc., failed to fulfill his gatekeeper responsibilities by accepting trading instructions from a person who was not authorized to provide such instructions and communicated with clients using an unapproved third-party communication application.
Moore agreed to sanctions including a reprimand and payment of costs in the amount of $7,500.
Read the news release for full details.
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 February additions to our Investment Caution List:
SimpleWealthFX
SimpleWealthFX claims to offer CFD trading services in forex, cryptocurrencies, indices, commodities, and stocks.
Simple Trade Cryptos
Simple Trade Cryptos claims to offer accounts for trading in forex, cryptocurrencies, commodities, stocks, and indices.
Bitcoin 365
Bitcoin 365 claims to be located in the United Kingdom and it also claims to offer trading services in cryptocurrencies, commodities, stocks, indices, and forex.
ZTK
ZTK claims to offer trading services in cryptocurrencies.
Call4trade
Call4trade claims to be located in the United Kingdom and it also claims to offer CFD trading services in forex, cryptocurrencies, indices, commodities, and stocks.
Meta Bank Wallet
Meta Bank Wallet claims to be located in the United Kingdom and it also claims to offer accounts for trading in cryptocurrencies, commodities, indices, stocks, and forex.
TGL
TGL claims to be located in the United Kingdom and it also claims to offer accounts for trading in cryptocurrencies, commodities, indices, stocks, and forex.
StexCoin
StexCoin claims to operate an online cryptocurrency trading platform and we are aware that StexCoin accepts British Columbia (BC) residents as clients.
BlockFusion Ventures
BlockFusion Ventures claims to be located in Canada and it also claims to offer trading services in cryptocurrencies.
GlobalFxp
GlobalFxp claims to be located in London, England. It also claims to operate an online forex, cryptocurrency, commodities, and index trading platform. We are aware that GlobaFxp accepts BC residents as clients.
Geminix
Geminix claims to offer different account types for trading in cryptocurrencies.
RBC Capital Markets LLC (no relation to the registered firm RBC Capital Markets, LLC)
https://rbccapitalmarketsllc.com/ claims to be located in Toronto, Canada and it also claims to offer different account types for trading in forex, commodities, indices, and stocks.We are aware that https://rbccapitalmarketsllc.com/ accepts British Columbia (BC) residents as clients.
TradeCryptoMasters
TradeCryptoMasters claims to be located in the United Kingdom and it also claims to offer different account types for trading in forex, commodities, cryptocurrencies, indices, and stocks.
Wemixvip.com
Wemixvip.com claims to offer trading services in cryptocurrencies.
PerfectFXOptionLive
PerfectFXOptionLive claims to be located in the United States and it also claims to offer trading services in cryptocurrencies. We are aware that they accept BC residents as clients.
Vendigital
Vendigital claims to offer trading services in cryptocurrencies, indices, stocks, commodities, and forex.
MagnumTrade
MagnumTrade claims to be located in Luxembourg and the United Arab Emirates. It also claims to offer different accounts for trading CFDs on forex, commodities, indices, and stocks. We are aware that they accept BC residents as clients.
Report a Concern
If you have concerns about a person or company offering an investment opportunity, please reach out to the 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.
InvestRight.org is the BC Securities Commission’s investor education website. Subscribe to receive email updates from BCSC InvestRight.
