In this edition of the Enforcement Roundup, we discuss one sanction, one finding, and one enforcement action from the BC Securities Commission (BCSC) and additions to the Investment Caution List. We also highlight one sanction from the Investment Industry Regulatory Organization of Canada (IIROC).
BCSC Enforcement
BCSC Sanction
QcX Gold Corp. (formerly First Mexican Gold Corp.), James Arthur Robert Voisin and John Charles Archibald
James Arthur Robert Voisin of Ontario, the former president and CEO of QcX Gold Corp., and geoscientist, John Charles Archibald of Victoria must pay the BCSC a total of $242,000 in penalties for making false or misleading statements.
In its sanctions decision, the panel said Voisin and Archibald showed a willingness to circumvent rules and standards designed to protect the investing public from misleading information. It concluded that significant prohibitions against their participation in public markets are justified to protect the public.
Read the news release for full details.
BCSC Finding
DFRF Enterprises LLC (DFRF Massachusetts), DFRF Enterprises, LLC (DFRF Florida), Daniel Fernandes Rojo Filho, Heriberto C. Perez Valdes, Sabrina Ling Huei Wei, Justin Colin Villarin and James Bernard Law
Three B.C. residents – Sabrina Ling Huei Wei, Justin Colin Villarin, and James Bernard Law – participated in an elaborate fraud that promised investors large, no-risk returns on gold mining operations in Africa and Brazil that didn’t exist, the BCSC has ruled.
In reality, DFRF’s only source of money was investors.
The scheme raised over US$15 million from more than 1,400 investors, according to the U.S. Securities and Exchange Commission (SEC). The BCSC found that 137 B.C. residents or people connected to the province lost a total of $1.5 million.
Described by the SEC as a Ponzi and pyramid scheme, it was orchestrated by Daniel Fernandes Rojo Filho, a Brazilian national who was living in Florida at the time.
The BCSC panel found that Wei, Law and Villarin chose to enable Filho’s deceitful acts, and knew – or should have known – that Filho’s claims, and theirs, were fraudulent. Although they became increasingly aware of red flags surrounding DFRF, including the promise of unreasonably high returns, the lack of details about its finances or mines, and the BCSC’s investor alert, Wei, Law and Villarin continued to promote it to unwitting investors.
Read the news release for full details.
BCSC Enforcement Action
Ward Derek Jensen
Jensen, a North Vancouver resident, has been charged with fraud and using forged documents after an investigation by the BCSC’s Criminal Investigations Branch.
Jensen was arrested on October 20, 2022. He was released on $10,000 bail and is prohibited from contacting the alleged victims, selling, promoting, buying, trading or distributing securities, or engaging in any investor relations activities, among other conditions.
The BCSC would like to thank the North Vancouver RCMP for their assistance with the arrest.
Read the news release for full details.
IIROC Enforcement
IIROC Sanction
BMO Nesbitt Burns Inc. (“BMO NBI”)
BMO NBI admitted that between January 2011 and March 31, 2017, they failed to adequately supervise the activities of a Registered Representative in relation to two client accounts that involved high new issue commissions and high turnover ratios which should have raised suitability and conflict of interest concerns, contrary to the IIROC rules.
BMO NBI has agreed to pay fine of $125,000 and $15,000 in costs.
IIROC formally initiated the investigation into BMO NBI’s conduct in January 2019. BMO NBI is an IIROC regulated firm.
Read the news release for full details.
BCSC Early Intervention
Investment Caution List
The BCSC publishes an Investment Caution List to notify British Columbians about unqualified investments and unregistered activity originating from outside of the province that accept B.C. residents as clients.
Below are nine additions to the Investment Caution List in October 2022.
Appraisal Digital Trade
Appraisal Digital Trade claims to be located in Ireland, and it also claims to offer accounts for trading in cryptocurrencies.
BitQL
BitQL claims to be located in Geneva and it also claims to offer cryptocurrency and forex trading account management services.
InertiaFinance
InertiaFinance claims to be located in St. Vincent and the Grenadines and it also claims to offer accounts for trading in forex, indices, stocks and commodities.
Chary Crypto Assets
Chary Crypto Assets claims to be located in the United States and it also claims to offer investment plans for bitcoin trading.
NovaTech Ltd.
NovaTech Ltd. claims to be located in Florida and it also claims to offer trading services by an experienced team of traders.
Coinsmart Platform
Coinsmart Platform claims to be located in Toronto, Ontario, and offers an online cryptocurrency trading platform that British Columbia (BC) residents can use to trade in cryptocurrency.
Livemarketpro
Livemarketpro claims to be located in the United States and it also claims to offer accounts for trading in forex.
CryptoFXpro
CryptoFXpro claims to be located in United Kingdom and it also claims to offer accounts for trading in forex, indices, stocks and commodities.
Motion Markets
Motion Markets claims to offer accounts for trading in forex, cryptocurrencies, stocks, indices and commodities.
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.
InvestRight.org is the BCSC’s investor education website. Subscribe to receive email updates from BCSC InvestRight.
