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.
