Ontario Securities Commission
IN THE MATTER OF VANTAGE GLOBAL PRIME PTY LTD AND VANTAGE INTERNATIONAL GROUP LTD
REASONS AND DECISION FOR APPROVAL OF A SETTLEMENT (Sections 127 and 127.1 of the Securities Act, RSO 1990, c S.5)
Hearing: In writing
Decision: July 14, 2021
Panel: Lawrence P. Haber, Commissioner and Chair of the Panel Craig Hayman, Commissioner Frances Kordyback, Commissioner
Appearances: Anna Huculak, For Staff of the Commission Lawrence E. Ritchie, For Vantage Global Prime Pty Ltd and Vantage International Group Ltd
REASONS AND DECISION FOR APPROVAL OF A SETTLEMENT
I. OVERVIEW
1Staff of the Ontario Securities Commission (Staff of the Commission) and Vantage Global Prime Pty Ltd (VGP) and Vantage International Group Ltd (VIG) (collectively, Vantage or the Respondents) have jointly submitted that it would be in the public interest for us to approve a settlement agreement among the parties dated July 7, 2021 (the Settlement Agreement) and to issue the requested order.
2This matter concerns allegations against the Respondents described in the Statement of Allegations dated July 8, 2021, which relate to foreign trading platforms failing to comply with Ontario securities law when trading with Ontario investors.
3Specifically, Staff alleges that the Respondents, by operating online trading platforms on which Ontario investors could trade in contracts for difference (CFDs) without registering or filing a prospectus with the Commission, breached ss. 25(1) and 53(1) of the Securities Act.1
4Staff and the Respondents have agreed that the Respondents’ conduct contravened Ontario securities law. After considering the Settlement Agreement and the submissions of the parties, we conclude that it would be in the public interest to approve the Settlement Agreement. These are our reasons.
II. summary of the facts
5The underlying facts and the specific breaches of Ontario securities laws are set out in the Settlement Agreement, which has been filed with the Commission and is publicly available. Accordingly, we need not repeat them in detail here.
6In summary, VGP and VIG were foreign related parties that operated online trading platforms on which investors could trade in CFDs. In 2019, the Australian Securities & Investments Commission advised its licensees (which included VGP) to examine and wind down their operations if there was a breach of the law in the overseas jurisdictions in which they operate. As a result, VGP, who was not registered with the Commission in any capacity and had not filed a prospectus with the Commission, ceased its operations in Ontario in July 2019. VGP gave their Ontario investors the option to close their accounts or be transferred to VIG, a related company registered and regulated by the Cayman Islands Monetary Authority. The Ontario investors that did not close their accounts continued to trade CFDs on VIG’s online trading platform.
7The parties acknowledge that CFDs are derivatives that constitute securities when offered to Ontario investors, and involve a distribution of a security when issued to Ontario investors. The CFDs opened and operated by Vantage provided Ontario investors with leveraged exposure to assets such as cryptocurrencies, soft commodities, precious metals and equities.
8Accordingly, between January 2014 and July 2019, VGP engaged in