Brian Weingarten

The Ontario Securities Commission sought sanctions against Nova Tech Ltd and its founder following a merits decision finding they engaged in unregistered trading, illegal distribution of securities, and breached a temporary cease trade order.

The respondents solicited Ontario investors for foreign exchange and crypto asset trading without registration or a prospectus, and evaded a Tribunal order by instructing investors on how to bypass jurisdictional restrictions.

The Capital Markets Tribunal ordered permanent market participation and director/officer bans, a $2.5 million administrative penalty, $31,000 in disgorgement, and $193,333.52 in costs, citing the egregious nature of the misconduct and the need for specific and general deterrence.

The Ontario Securities Commission alleged that the respondents created and sold a crypto asset called GXToken without registration or a prospectus.

The Capital Markets Tribunal found that the GXTokens were investment contracts and therefore securities.

The Tribunal concluded that the respondents engaged in unregistered trading and illegal distribution of securities contrary to the Securities Act.

The respondents were ordered to pay administrative penalties, disgorge funds obtained from the non-compliance, and pay costs, in addition to being subject to market participation and director/officer bans.

The Ontario Securities Commission alleged that Nova Tech Ltd and its principal, Cynthia Petion, breached the Securities Act by engaging in unregistered trading and illegal distribution of securities through their PAMM product, which purported to offer passive returns from forex and crypto trading.

The Capital Markets Tribunal found that the PAMM product was an investment contract and therefore a security.

The Tribunal concluded that Nova Tech breached the registration and prospectus requirements of the Act, and also breached a temporary cease trade order by continuing to accept investments.

Petion, as sole director and CEO, was found to have authorized these breaches.

Staff of the Ontario Securities Commission brought a motion in writing to waive service of the Notice of Hearing and Statement of Allegations on the individual respondent, who had evaded service.

The Capital Markets Tribunal granted the motion, finding that Staff had exhausted all reasonable efforts to serve the respondent.

The Tribunal also relieved Staff of future service and disclosure obligations and ordered that the merits hearing proceed in the respondents' absence.

The respondent, Silvio Serrano, brought a motion seeking disclosure of unredacted transcripts of compelled interviews and an unredacted confidentiality order, or in the alternative, a stay of the enforcement proceeding against him.

The Capital Markets Tribunal found that the redacted information met the test for disclosure and was necessary for Serrano to make full answer and defence.

However, an existing confidentiality order prevented Staff from disclosing the information, and the Tribunal declined to vary or vacate that order.

Concluding that proceeding without the disclosure would cause actual prejudice and constitute an abuse of process, the Tribunal granted a stay of the proceeding against Serrano.

Staff of the Ontario Securities Commission brought an application to extend a temporary cease trade order against Nova Tech Ltd, an offshore entity that appeared to be engaging in unregistered trading and illegal distribution of securities.

The respondent did not appear.

The Capital Markets Tribunal found sufficient evidence of ongoing harm to Ontario investors to justify extending the order.

However, the Tribunal declined Staff's request to extend the order indefinitely until the completion of a future enforcement proceeding.

Balancing factors including transparency, longevity of temporary orders, and control over Tribunal proceedings, the Tribunal extended the order until the earlier of 10 days after the issuance of a Statement of Allegations or 6 months after the extension order.

Staff of the Ontario Securities Commission brought a motion in writing for procedural relief, including proceeding without notice to one respondent, waiving service of the Notice of Hearing and Statement of Allegations on him, waiving service of future processes on all respondents, and dispensing with disclosure obligations.

The Tribunal found that Staff had exhausted all reasonable efforts to locate and serve the unserved respondent and that the other respondents had been validly served but failed to participate.

The Tribunal granted the requested relief, waiving future service and disclosure requirements to ensure a just, expeditious, and cost-effective proceeding.

Staff of the Ontario Securities Commission alleged that Plateau Energy Metals Inc. made misleading statements in news releases and filings regarding the status of its mining concessions in Peru, and that its CEO and CFO authorized or acquiesced in these contraventions.

Staff also alleged the CEO made selective disclosure to certain shareholders.

The parties entered into a settlement agreement wherein the respondents agreed to pay administrative penalties totaling $750,000 and investigation costs totaling $300,000.

The Capital Markets Tribunal approved the settlement, finding it fell within a range of reasonable outcomes and was in the public interest.

The Crown appealed a conditional discharge imposed on a 19-year-old first offender who pleaded guilty to assault causing bodily harm.

The sentencing judge had imposed the discharge without giving the Crown notice or an opportunity to make submissions, which the appeal court found to be an error in principle.

However, upon conducting a fresh assessment, the appeal court concluded that a conditional discharge was the fit and appropriate sentence given the offender's youth, lack of record, genuine remorse, and positive rehabilitative steps.

The appeal was dismissed and the conditional discharge was upheld.

The appellant, unrepresented at trial, was convicted of impaired care or control and refusing a breath sample.

The appeal court found that the trial judge failed to adequately assist the unrepresented accused by not explaining the essential elements of the offences, particularly regarding the evidentiary shortcut for care or control and the reverse onus for reasonable excuse in refusing a breath sample.

This failure resulted in an unfair trial, constituting a miscarriage of justice.

The curative proviso was deemed inapplicable.

The appeal was allowed, convictions set aside, and a new trial ordered on both counts.

The appellant appealed his sentence of ten years and two months imposed for arson causing bodily harm and arson causing property damage.

The Court of Appeal upheld the sentence as fit, finding that even if the trial judge erred in referring to an aggravating factor, it had no impact on the global sentence.

The court confirmed that consecutive sentences were appropriately imposed as the offences involved different elements.

Leave to appeal sentence was granted and any victim fine surcharge was set aside.

The applicant sought an extension of time to appeal a summary conviction sentence, arguing that a change in immigration law (Tran v. Canada) made his original sentence, which led to deportation, disproportionate.

The court dismissed the application, finding that the applicant had not shown a bona fide intention to appeal within the period, had not adequately explained the four-year delay, and that the proposed appeal lacked merit.

The court emphasized the principle of res judicata and that the applicant was no longer "in the judicial system" for the purpose of retroactively applying new legal interpretations.

The applicants sought an order in the nature of certiorari quashing their committal to stand trial on charges of trafficking in persons and receiving a financial benefit.

They argued the preliminary inquiry justice erred in law by committing them despite an absence of evidence that they exploited the complainant.

The court dismissed the application, finding there was sufficient evidence that the applicants abused their position of trust or power as the complainant's drug suppliers to induce her to provide sexual services, which could reasonably be expected to cause her to fear for her safety if she stopped.

The appellant appealed his four-year sentence for criminal harassment and assault of his former partner.

He argued the trial judge erred by denying 1.5:1 credit for pre-sentence custody, sentencing him to a penitentiary term for treatment, and imposing a demonstrably unfit sentence.

The Court of Appeal found the trial judge erred in denying the 1.5:1 credit based on the likelihood of bail denial, applying the Summers principle to grant the enhanced credit.

However, the court dismissed the other grounds, finding the penitentiary sentence was not imposed solely for treatment and the four-year total sentence was not demonstrably unfit given the egregious domestic abuse.