OCMT 2008

The Ontario Securities Commission held a hearing to consider a settlement agreement between Staff and the respondent, a former senior investment banker.

The respondent admitted to breaching the tipping prohibition under s. 76(2) of the Securities Act by disclosing confidential material information regarding ten corporate transactions to a close friend, who subsequently engaged in illegal insider trading.

The Commission approved the settlement agreement, finding the sanctions, which included permanent bans from the securities industry and a $250,000 payment towards investigation costs, to be in the public interest and within acceptable parameters.

Staff of the Ontario Securities Commission sought to extend a temporary cease trade order against the respondents, who were alleged to have engaged in unregistered trading and illegal distributions of securities.

Only one respondent appeared at the hearing, unrepresented, and contested the extension but provided no evidence.

The Commission admitted hearsay evidence from Staff's investigator, finding it appropriate at an early stage of the proceeding.

Applying the reverse onus under s. 127(8) of the Securities Act, the Commission found the respondent failed to provide satisfactory information to show why the order should not be extended.

The temporary cease trade order was extended against all respondents.

The Ontario Securities Commission held a hearing on the merits regarding allegations that Limelight Entertainment Inc. and its principals and salespersons engaged in unregistered trading and illegal distributions of securities.

The Commission found that the respondents raised approximately $2.75 million from investors across Canada and internationally using high-pressure sales tactics, without being registered and without filing a prospectus.

The respondents purported to rely on the accredited investor exemption, but the vast majority of investors did not qualify.

The Commission also found that the respondents made prohibited representations regarding the future listing of shares, filed misleading reports, misled Commission Staff during the investigation, and breached temporary cease trade orders.

The conduct was found to be egregious and contrary to the public interest.

A sanctions hearing was ordered to be scheduled.

Staff of the Ontario Securities Commission sought to extend a temporary cease trade order against the respondent pending the completion of an investigation into potentially illegal distributions and market manipulation involving several companies.

The Commission found sufficient evidence of conduct potentially harmful to the public interest to justify extending the order.

However, the Commission granted the respondent a restricted personal trading carve-out, subject to strict reporting conditions, as the investigation was ongoing and no Statement of Allegations had yet been issued.

The Ontario Securities Commission held a hearing to consider whether to approve a settlement agreement between Staff and the respondent, a former director and officer of Philip Services Corp. The respondent admitted to failing to ensure that the company filed financial statements containing full, true, and plain disclosure regarding a restructuring charge, holding certificates, unrecorded liabilities, and a financing arrangement.

The Commission approved the settlement agreement as being in the public interest, imposing sanctions that included a 20-year director and officer ban, a 10-year trading ban, a reprimand, and $125,000 in costs.