BCSC Fines Panamanian Investment Dealer $350,000 for Unregistered Trading

The BCSC has banned and fined Verdmont Capital for unlawfully trading securities on behalf of its clients.

In a settlement agreement with the British Columbia Securities Commission (BCSC), Panama-based Verdmont Capital has admitted to trading securities on behalf of British Columbia (BC) residents without being registered.

The FM London Summit is almost here. Register today!

Join the iFX EXPO Asia and discover your gateway to the Asian Markets

Unregulated

According to the BCSC, Verdmont traded securities on behalf of over 100 BC residents without being registered by the Commission between January 2010 and August 2013.

In May 2013, the BCSC discovered that Verdmont promoted its securities trading services through its website, but did not post any restrictions or limitations on Canadians opening accounts or using the advertised services. As such, the company did not take sufficient precautions not to trade on behalf of BC residents.

After requests from the BCSC in July 2013, Verdmont and Panamanian securities regulators provided information regarding over 100 Verdmont BC client accounts.

Suggested articles

Going Past the Great Wall: Things to Consider When Entering the Asian MarketGo to article >>

It was also noted that prior to the investigation, after determining that its BC client accounts were not in compliance with BC securities laws, Verdmont began to freeze or close its client accounts. The company also added a disclaimer to its website prohibiting Canadian residents from opening accounts.

Verdmont has paid $350,000 in penalties to the BCSC to settle the case and is also permanently banned from trading in or purchasing any securities and from engaging in investor relations activities.

Verdmont consequently filed for liquidation in January 2016 and is now no longer operating.

Background

The BCSC is the independent provincial government agency responsible for regulating securities trading in British Columbia through the administration of the Securities Act. The regulator website provides information, tools and resources for investors, including investor warnings about individuals and companies that appear to be engaging in unauthorised activities.

This is the latest in a series of fines of varying amounts imposed by the BC regulator for conducting financial services activities without a license, or other violations of the law. The Commission last imposed a hefty fine of $15 million against a Ponzi scheme operator last August, as reported by Finance Magnates.

Got a news tip? Let Us Know