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Enforcement Roundup: October 2021

Golden scales of justice with a gavel and legal textbooks in the background represent enforcement actions taken in British Columbia by securities regulators in October 2021.
The Enforcement Roundup is a monthly summary of enforcement decisions in British Columbia taken by securities regulators.

The October 2021 edition of the Enforcement Roundup features findings and decisions relating to enforcement proceedings from the BC Securities Commission (BCSC), the Mutual Fund Dealers Association of Canada (MFDA), and the Investment Industry Regulatory Organization of Canada (IIROC).

BCSC Enforcement

BCSC Findings

Zahir “Zip” Dhanani, Robert Naso, Arian Resources Corp.

Dhanani and Naso, residents of British Columbia, and their company Arian Resources Corp., failed to disclose information, concealed financial losses and made false or misleading statements.

The panel will consider imposing sanctions on the respondents after submissions from BCSC staff and the respondents.

In 2017, the BCSC issued a cease trade order because Arian failed to file records required under the Securities Act. The cease trade order remains in effect. In 2018, the BC registrar of companies dissolved Arian for failing to file annual reports.

Read the news release for full details.

News Release

BCSC Settlement Agreements

Kilburn Ogilvie Waymann Investment Management Ltd. (KOWIM) 

Under a settlement agreement, KOWIM paid $55,700 to the BCSC for not managing business-associated risks and not providing reasonable assurance that it complied with securities legislation.

As part of the firm’s settlement, it must retain an independent compliance consultant for two years and submit its next two annual Chief Compliance Officer reports to the BCSC.

This is the second time the BCSC has found deficiencies at KOWIM. In 2012, the firm admitted that it failed to establish and maintain an adequate compliance system, and failed to maintain a minimum level of regulatory capital.

Read the news release for full details.

News Release

MFDA Enforcement

MFDA Settlement Agreements

Adrian Kotze

Kotze, who conducted business out of the Port Coquitlam, BC area, admitted that between approximately June 2013 and January 2017, he obtained and possessed five pre-signed account forms in respect of three clients, contrary to the MFDA’s Standard of Conduct rule.

As a result, Kotze must pay a $13,000 fine, $2,500 in costs, and comply with the contravened rule in the future. He shall successfully complete the Ethics and Professional Conduct Course offered by the IFSE Institute, or an industry course acceptable to Staff of the MFDA, within six months of the acceptance of the settlement agreement.

Read the news release for full details.

News Release

MFDA Sanctions

Lucillia Sok Cheng Tan

The MFDA panel found that Tan, who conducted business out of the Burnaby, BC area, violated several MFDA rules.

As a result, Tan must pay a $125,000 fine and $10,000 in costs. She is also permanently prohibited from conducting securities related business in any capacity while in the employ of or associated with any MFDA member.

Read the news release for full details.

News Release

IIROC Enforcement

IIROC Sanctions

Alberto Storelli

A Hearing Panel of the IIROC found that Storelli was liable of compensating clients, providing an unauthorized account statement to clients, making misrepresentations to enforcement staff, and failing to cooperate with enforcement staff who were conducting an investigation.

Storelli has been ordered to pay a $50,000 fine and costs in the amount of $10,000. His registration has been suspended for four years.

The violations occurred while he was a registered representative with the Richmond, British Columbia branch of Global Maxfin Capital Inc. Mr. Storelli is no longer a registrant with an IIROC-regulated firm.

Read the news release for full details.

News Release

Thomas Stock

Stock admitted to conduct involving excessive and unsuitable trading in the accounts of a client that was not within the bounds of good business practices, and a failure to cooperate with IIROC enforcement staff.

Stock agreed to pay a $10,000 fine and $5,000 in costs. He’s also been permanently barred to approval in any capacity.

The alleged violations occurred while he was a registered representative with the Vancouver branch of Haywood Securities Inc. Mr. Stock is no longer a registrant with an IIROC-regulated firm.

Read the news release for full details.

News Release

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 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 BC Securities Commission’s investor education website. Subscribe to receive email updates from BCSC InvestRight.

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