Paulette L. Kennedy

Following a merits hearing where the respondents were found to have engaged in unregistered trading, illegal distribution of securities, and fraud, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission ordered permanent market bans, significant administrative penalties, and disgorgement against the directing minds of the fraudulent scheme.

The salesperson respondents received market bans ranging from 5 to 10 years, along with administrative penalties and disgorgement orders equal to the commissions they earned.

Costs were also apportioned among the respondents.

Following a merits decision finding that the respondents engaged in unregistered trading, illegal distribution of securities, and made prohibited representations, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission ordered permanent and long-term trading, acquisition, and exemption bans against the corporate and individual respondents, along with director and officer bans.

The Commission also ordered administrative penalties totaling $935,000, disgorgement of over $2.5 million, and costs of $305,000, finding that the respondents' conduct was serious, deceitful, and caused substantial harm to investors.

Staff of the Ontario Securities Commission alleged that the respondents, Z2A Corp. and its sole director Christine Hewitt, engaged in unregistered trading and illegal distribution of securities in connection with a charitable gifting program run by Innovative Gifting Inc. (IGI).

The respondents facilitated the issuance of shares in RCT Global Networks Inc. to donors in exchange for cash donations, receiving a 10% commission on the cash donated.

The Commission found that the respondents' conduct constituted acts in furtherance of trades in RCT securities, contrary to s. 25(1)(a) of the Securities Act.

Furthermore, the trades involved previously unissued treasury shares, constituting an illegal distribution contrary to s. 53(1).

As the directing mind of Z2A, Hewitt was deemed to have authorized, permitted, and acquiesced in the non-compliance pursuant to s. 129.2 of the Act.

Following a merits hearing where the respondents were found to have engaged in unregistered trading, illegal distribution, and fraud in connection with the 'Axcess Investments' scheme, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission ordered permanent trading and market prohibitions against Driver, Taylor, and their respective companies, along with significant administrative penalties and disgorgement orders.

Reynold and his company, who were not found to have acted fraudulently but engaged in unregistered trading and illegal distribution, were subject to 15-year market prohibitions, an administrative penalty, and disgorgement.

The respondents were also ordered to pay the costs of the investigation and hearing.

Following a finding that the respondent engaged in conduct contrary to the public interest by purchasing shares while in possession of undisclosed material facts, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission declined to impose the 10-year trading bans sought by Staff, finding them excessive given that no technical breach of the Securities Act occurred.

Instead, the Commission ordered a five-year prohibition on the respondent acting as a director or officer of a reporting issuer, issued a reprimand, and ordered the respondent to pay $150,000 in costs.

The Ontario Securities Commission held a hearing on the merits regarding allegations that Global Energy Group, Ltd. and several individuals operated a fraudulent investment scheme.

The respondents sold unregistered securities in the form of limited partnership units in purported Kentucky oil drilling programs to investors, raising over US$16 million.

The Commission found that the respondents traded in securities without registration and distributed securities without a prospectus, with no exemptions available.

Furthermore, the Commission found that the directing minds of Global Energy, Vadim Tsatskin and Christina Harper, perpetrated a fraud on investors by making false representations about the company's history, the use of investor funds, and the expected returns.

The Commission concluded that the respondents' conduct breached the Securities Act and was contrary to the public interest.

Following a merits decision finding that the respondent Suman engaged in insider tipping and both respondents traded on undisclosed material information regarding a corporate acquisition, the Commission held a sanctions and costs hearing.

The respondents had already been subject to a US judgment ordering disgorgement and significant civil penalties for the same conduct.

The Commission ordered permanent market bans against Suman and five-year bans against Rahman.

Suman was ordered to pay an administrative penalty of $250,000 and disgorge $954,938.07, with credit given for any amounts paid under the US judgment.

The respondents were ordered to pay $250,000 jointly and severally for the costs of the investigation and hearing.

Following a merits decision finding that the individual respondents engaged in unregistered trading and perpetrated a fraud on investors by misappropriating approximately $22 million in investor funds for personal luxury expenses, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission ordered permanent market bans, reprimands, and director/officer bans against the respondents.

Additionally, the Commission ordered each respondent to pay an administrative penalty of $750,000, and ordered them to jointly and severally disgorge $21,908,607.

The respondents were also ordered to pay $257,756.32 in costs.

Parrish & Heimbecker, Limited (P&H) and Thirdcoast Limited filed cross-applications before the Ontario Securities Commission regarding P&H's take-over bid for Thirdcoast.

P&H sought to cease trade Thirdcoast's shareholder rights plan (poison pill), while Thirdcoast sought to cease trade shares subject to lock-up agreements entered into by P&H, alleging the bid was coercive and offered collateral benefits.

The Commission found the bid was not coercive and no prohibited collateral understanding existed.

The Commission granted P&H's application, permanently cease trading the rights plan, as it had served its purpose and no competing bid had emerged, and dismissed Thirdcoast's application.

The Ontario Securities Commission held a hearing on the merits regarding allegations that the respondents engaged in unregistered trading and securities fraud.

The respondents, who were the principals of the New Life group of companies, raised approximately $22 million from investors purportedly to purchase life insurance policies.

The Commission found that the respondents breached section 25(1)(a) of the Securities Act by engaging in acts in furtherance of trades without registration.

Furthermore, the Commission found that the respondents breached section 126.1(b) of the Act by perpetrating a fraud on investors, having misappropriated over 40% of investor funds for personal luxury purchases and having paid fictitious dividends from new investor funds.

As directors and officers, the respondents were also found liable under section 129.2 for authorizing, permitting, and acquiescing in the corporate breaches.

Staff of the Ontario Securities Commission sought sanctions and costs against the respondents following a merits decision that found they engaged in unregistered trading, illegal distribution, and fraud.

The respondents raised over $4.4 million from approximately 80 investors through the sale of bonds, using high-pressure sales tactics and misusing the accredited investor exemption.

The funds were misappropriated to pay personal expenses and existing bondholders.

The Commission ordered permanent market prohibitions, permanent director and officer bans, and reprimands.

The Commission also ordered administrative penalties totaling $650,000, disgorgement of $3,132,106, and costs of $245,500, apportioned among the respondents based on their respective involvement.

In an oral decision on the merits, the Ontario Securities Commission found that the respondents breached the Securities Act by perpetrating a fraud on investors, trading securities without registration, and authorizing corporate breaches.

The respondents failed to attend the hearing and Staff's evidence was uncontroverted.

The Commission concluded the respondents acted contrary to the public interest, with reasons to follow and a sanctions hearing to be scheduled.

Following a merits decision finding that Coventree Inc. and its senior officers, Geoffrey Cornish and Dean Tai, failed to disclose material changes in breach of the Securities Act, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission emphasized the fundamental importance of timely disclosure to the integrity of capital markets.

While noting mitigating factors such as the respondents' lack of intent to mislead and their cooperation with Staff, the Commission imposed significant administrative penalties to achieve specific and general deterrence.

Coventree was ordered to pay a $1 million penalty and $250,000 in costs, while Cornish and Tai were each ordered to pay a $500,000 penalty and were prohibited from acting as directors or officers of a reporting issuer for one year.

The applicant applied under section 144 of the Securities Act to revoke a 2008 Commission order approving a settlement agreement regarding allegations of tipping.

The applicant argued that Staff failed to disclose an ongoing investigation into a key witness for breaching a cease trade order, which would have undermined the witness's credibility and altered the applicant's decision to settle.

The Commission found it had jurisdiction to hear the application but dismissed it on the merits.

The Commission held that the applicant's decision to settle was voluntary, unequivocal, and informed, and that Staff had fulfilled its disclosure obligations by orally informing the applicant's counsel of the investigation.

Furthermore, the undisclosed information regarding the witness's unintentional breach of the cease trade order was not crucial and would not have likely affected the outcome of the proceedings.

Deutsche Bank Securities Limited applied to the Ontario Securities Commission for a hearing and review of a decision by an IIROC Hearing Panel that dismissed its motion to stay a Notice of Hearing.

The applicant argued that IIROC lacked jurisdiction because it could not compel evidence from non-members, thereby denying the applicant the right to make full answer and defence.

The Commission dismissed the application, finding that the IIROC Hearing Panel correctly applied the law by reserving the stay decision until the extent of any prejudice could be assessed at a hearing on the merits.

The Commission also held that the application was premature.

Following a merits decision finding the respondents engaged in a fraudulent boiler room investment scheme that raised over US $2.2 million from investors, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission ordered permanent trading and market prohibitions against all respondents, with a limited RRSP carve-out for one respondent.

The individual respondents were ordered to pay administrative penalties ranging from $100,000 to $350,000, reflecting their respective roles in the fraud.

The Commission also ordered disgorgement of the funds obtained from investors, totaling over $2.1 million, and apportioned Staff's hearing costs of $85,758.94 among the respondents.

The monetary sanctions were ordered to be allocated for the benefit of third parties, including the defrauded investors.

Staff of the Ontario Securities Commission applied for a temporary order against the respondents, alleging they engaged in unregistered advising and made misleading statements to Staff.

The Commission found sufficient evidence that the individual respondent was providing investment advice to Ontario clients for compensation without registration, and that he had been evasive and uncooperative during the investigation.

Concluding that the conduct may be harmful to the public interest, the Commission issued a temporary order requiring the respondents to cease trading in securities, with limited exceptions, and removing their access to exemptions under Ontario securities law pending a hearing on the merits.

Following a merits decision finding that the respondents engaged in unregistered trading, illegal distributions, and in some cases fraud, the Ontario Securities Commission determined the appropriate sanctions and costs.

Although investors did not lose money because the principal respondents voluntarily repaid the capital with 18% interest, the Commission imposed significant administrative penalties, trading bans, and director/officer bans to deter future misconduct.

Disgorgement was not ordered.

Costs of $180,000 were awarded against the principal respondents.

Staff of the Ontario Securities Commission alleged that the respondents engaged in an illegal scheme to sell securities (Borealis Guaranteed Return Investment Certificates) without registration or a prospectus, and that the scheme was fraudulent.

The respondents raised over $16 million from investors by promising 18% annual returns and falsely representing that the funds would be deposited with a trust company to leverage loans for small businesses, and that the investments were fully insured by CDIC and reinsured by major international insurers.

The Commission found that the Borealis GRIC was an investment contract and therefore a security.

The Commission concluded that several corporate and individual respondents, including the key organizers, traded without registration, distributed securities without a prospectus, and perpetrated a fraud on investors by making material misrepresentations about the security and insurance of the investments.

Certain peripheral respondents were found to have traded illegally but were not found liable for fraud.

Nunavut Iron Ore Acquisition Inc. applied to the Ontario Securities Commission for an order cease trading the shareholder rights plan of Baffinland Iron Mines Corporation.

Nunavut had made an unsolicited takeover bid for Baffinland, which was followed by a higher competing offer from ArcelorMittal supported by the Baffinland board.

The Commission found that the rights plan had served its purpose by facilitating an auction and generating a competing bid.

Maintaining the rights plan would only serve to eliminate the timing advantage of Nunavut's first-in-time offer and force an extension, potentially depriving shareholders of a revised offer.

The Commission concluded it was in the public interest to cease trade the rights plan immediately, allowing shareholders to decide between the competing offers.