Fraudster misused investor funds intended for a medical business on personal expenses
The Alberta Securities Commission (ASC) has imposed sanctions on Paul Lackan following findings of fraudulent activity against investors.
Between July 2018 and December 2020, Lackan raised $153,500 from eight investors under the pretext of acquiring or investing in ACT Medical Centres Inc. (ACT).
However, it was determined that at least $115,378 of these funds were misappropriated for personal and unrelated business expenses. None of the investors received returns or their principal investment.
The ASC panel noted that Lackan falsely claimed the funds were for ACT, a legitimate medical business, and provided investors with falsified share certificates.
Despite promises, no certificates for ACT shares were issued, and the funds were instead used for personal expenses.
The panel concluded that Lackan acted deceitfully, leveraging relationships with clients and misrepresenting his intentions.
Lackan is permanently banned from Alberta's capital markets. He is required to:
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Resign from all positions as director or officer of any issuer or related entity.
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Pay an administrative penalty of $60,000.
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Disgorge $115,378 obtained from his fraudulent activities.
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Cover investigation and hearing costs amounting to $47,009.
The ASC described Lackan’s actions as deliberate and egregious, involving deceit and abuse of trust. The decision highlighted that fraud undermines confidence in the capital markets and poses a significant risk to investors.
Despite his financial difficulties and minimal participation in the hearing process, the sanctions aim to serve both specific and general deterrence.
