Tamara Center

Staff of the Commission brought allegations against GreenStar Agricultural Corporation and its CEO, Lianyun Guan, for failing to file continuous disclosure documents, failing to cooperate with an audit, and obstructing an independent investigation.

The hearing proceeded in writing in the absence of the respondents.

The Commission found that the respondents breached Ontario securities law and acted contrary to the public interest.

A schedule was set for submissions on sanctions and costs.

The Ontario Securities Commission issued its decision on sanctions and costs following a merits decision that found the respondents contravened the Securities Act by engaging in insider trading and tipping.

The respondents included a mergers and acquisitions lawyer who instigated the tipping scheme and several investment advisors who traded on and further disseminated the material non-public information.

The Commission imposed 10-year trading bans, permanent or 10-year director and officer bans, and 10-year registration bans for the investment advisors.

The Commission also ordered disgorgement of profits totaling $84,698, administrative penalties totaling $2,150,000, and costs of $500,000 apportioned among the respondents based on their respective culpability and involvement in the proceedings.

Following a merits hearing where the respondents were found to have engaged in unregistered trading and advising in commodity futures contracts and misled Staff, the Commission held a sanctions and costs hearing.

The Commission ordered permanent market bans against the respondents, administrative penalties of $200,000 each against Khan and his company, disgorgement of $366,324.71, and costs of $191,252.43.

The Commission found the respondents' conduct to be serious and noted Khan's unmanageable behaviour during the hearing, concluding that significant sanctions were necessary for specific and general deterrence.

The Ontario Securities Commission alleged that the Respondents engaged in unregistered trading and advising in commodity futures contracts, made misleading statements to Staff, and acted contrary to the public interest.

The Respondents operated a trading school and assisted students in opening trading accounts with specific brokers, receiving undisclosed referral commissions.

Khan also traded on behalf of clients in managed accounts and provided live trading advice.

The Commission found that the Respondents breached the registration requirements of the Commodity Futures Act, made untrue statements during the investigation, and breached a prior undertaking, all of which constituted conduct contrary to the public interest.

The moving parties sought an adjournment of a scheduled merits hearing regarding insider trading and tipping allegations, arguing that their expert consultant had lost approximately 600 hours of work product.

Staff opposed the adjournment and brought a cross-motion to sever the matter against one respondent if the adjournment was granted.

The Commission dismissed the adjournment motion, finding that the expert consultant was sufficiently prepared to assist counsel with cross-examinations and that the matter, which had been outstanding for four years, needed to proceed in a timely manner.

The cross-motion for severance was also dismissed.

The Ontario Securities Commission held a sanctions and costs hearing following a merits decision that found the respondents engaged in unregistered trading, illegal distribution of securities, and fraud through a boiler room operation.

The respondents raised approximately $1.2 million from 57 investors, misappropriating a significant portion for personal use.

The Commission ordered permanent market bans against the respondents, including permanent director and officer bans for the individual respondent.

The respondents were also ordered to pay an administrative penalty of $400,000, disgorge $1,231,800 on a joint and several basis, and pay $280,721.02 in costs.

The applicants, respondents in an enforcement proceeding alleging unregistered trading and advising in commodity futures, brought a motion for direction to summons approximately 700 witnesses for the merits hearing.

The proposed witnesses included 679 account holders, Commission enforcement staff, brokerage executives, and other individuals.

The Commission held that while the threshold for issuing a summons is low, the evidence sought must be relevant and not unduly repetitious.

The Commission found that the applicants failed to demonstrate that all 679 account holders would provide relevant, non-repetitious evidence, but permitted a representative sample to be called.

The requests to summons enforcement staff and other witnesses were denied at this stage due to an insufficient basis demonstrating relevance or necessity.

The Ontario Securities Commission held a hearing on the merits regarding allegations that Moncasa Capital Corporation and its directing mind, John Frederick Collins, engaged in unregistered trading, illegal distribution, and securities fraud.

The respondents raised approximately $1.2 million from 57 investors by falsely claiming the funds would be used to purchase luxury Caribbean real estate.

In reality, the respondents operated a boiler room, misappropriated investor funds for personal use, and made numerous misrepresentations.

The Commission found that the respondents breached the registration and prospectus requirements of the Securities Act and engaged in fraud.

Collins was also found to have made false statements to Commission staff and was deemed liable for Moncasa's breaches as its sole director and officer.

The Crown appealed a sentence imposed under the Securities Act for unregistered trading, trading without a prospectus, and breaching prohibition orders.

The sentencing judge had imposed an 18‑month sentence to run concurrently with a 27‑month sentence the respondent was already serving for separate securities offences involving a different company.

The Crown argued that the concurrent sentence undermined deterrence and failed to reflect that the offences arose from separate schemes occurring at different times with different victims.

The Superior Court held that the sentencing judge erred by failing to adequately consider the distinct nature of the schemes and the respondent’s repeated breaches of prohibition orders.

The court concluded that the totality principle did not render a 45‑month total sentence disproportionate and ordered the 18‑month term to be served consecutively.

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

The Commission imposed permanent trading and director/officer bans on the respondents, with limited carve-outs for RESPs.

The Commission also ordered administrative penalties of $300,000 for Elin and $400,000 for Mellon, and joint disgorgement of $353,229.19.

Staff's request for costs was denied due to an unexplained 18-month delay in the proceedings.

Following a merits hearing where the Respondents were found to have perpetrated a fraud on investors and breached their duties as investment fund managers, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission found that the Respondents' conduct was egregious and caused significant financial losses to investors.

The Commission ordered the termination of the Respondents' registrations, permanent and temporary market prohibitions, and director/officer bans.

Additionally, the Commission ordered administrative penalties totaling $1.3 million, disgorgement of $6.74 million in profits obtained from the non-compliance, and costs of $435,000 against the individual respondents.

The moving parties brought a motion challenging the jurisdiction of a single Commissioner to complete a sanctions hearing after the term of the other panel member expired.

The moving parties argued that proceeding before a single member violated the audi alteram partem principle and the quorum requirements of the Securities Act.

The Commission dismissed the motion, finding that section 4.4(1) of the Statutory Powers Procedure Act permits the remaining member to complete the hearing and give a decision, and that section 32 of the SPPA resolves any conflict with the Securities Act's quorum requirements in favour of the SPPA.

The Ontario Securities Commission found that the respondents, Richard Mellon and Alex Elin, engaged in a fraudulent investment scheme involving the sale of shares in two mining companies, Karp and Legacy.

The respondents operated a boiler room that targeted European investors, raising over $350,000.

The Commission concluded that the respondents traded in securities without registration, made illegal distributions without a prospectus, and made prohibited representations that the securities would be listed on a stock exchange.

The allegations regarding undertakings as to future value were dismissed.

A sanctions and costs hearing was ordered.