OCMT 2013

Following a merits hearing where the respondents were found to have engaged in unregistered trading and illegal distribution of securities in relation to a Ponzi scheme (Gold-Quest), the Commission held a sanctions and costs hearing.

The Commission found that the respondents were duped by the scheme's promoters and believed they were operating under a 'friends and family' exemption, which mitigated their culpability.

The Commission ordered five-year market bans, full disgorgement of commissions earned, administrative penalties of $15,000 for each individual respondent, and costs against one represented respondent.

The respondent admitted to engaging in unregistered trading and illegal distribution of securities by selling shares of Electrolinks Corporation to investors without a prospectus.

The respondent raised over $1.6 million from 89 investors, who suffered a complete loss.

The Ontario Securities Commission ordered permanent market bans, a $150,000 administrative penalty, and disgorgement of $486,000, finding the respondent's conduct to be predatory and a serious breach of Ontario securities law.