The Nova Scotia Securities Commission (NSSC) has issued a temporary cease trade order against Stratus Financial Group International, Stratus Offshore, as well as Magnus Torgenson and John Westbrook, according to an NSSC statement.
The genesis of the action stems from numerous complaints from residents in Nova Scotia, stating they were being browbeaten by company representatives to invest in natural gas and foreign exchange (FX) options. Stratus Financial Group is not registered to sell securities in Nova Scotia, culminating in the commission ordering the cessation of trading in the province by the group, Mr. Torgenson, and Mr. Westbrook immediately.
This is hardly the first such example of company’s preying upon would-be investors without proper authorization to do so. The tactics utilized by Stratus are often referred to as boiler room tactics, which involve a high-pressure approach from representatives calling lists of people, known as ‘sucker lists’.
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By pressuring investors into buying highly speculative, and oftentimes fraudulent investments, victims are lulled into the false security of ‘safe’ or ‘once-in-a-lifetime’ investments that regularly backfire. The plot thickens for Stratus, that is also the subject of a permanent cease trade order in New Brunswick.
According to Heidi Schedler, enforcement counsel for the NSSC, in a statement on the mandate, “Investors who fall prey to the high-pressure, now-or-never script used by these kind of representatives are at significant risk of losing a lot of money. We’re concerned for the financial safety of Nova Scotians and want the public to know that they can always hang up the phone and take the time to make sure that whoever is contacting them is registered with a securities commission.”
As a result of the cease-trade order, the NSSC also urges Nova Scotians to utilize extreme caution when dealing with firms that are not registered in Nova Scotia. It is presently illegal to solicit investments in the province without registering with the commission and complying with Nova Scotia securities laws.