If you thought over-the-counter listing requirements were too easy to meet, you’re not one of two players just handed stiff penalties from BC’s securities commission.
Two men from B.C. that sought to skirt B.C. securities law have been banned for engaging in investor relations activities following an illegal deal that involved three mining companies.
“In order to avoid the application of the Over-the-Counter (OTC) Rule and the filing requirements that came with it, Robert Scott Morrice, a retired lawyer, suggested to Donald Gordon Byrne, his colleague that he find officers and directors for the companies outside of B.C.,” reads the decision. “Morrice also filed disclosure with the SEC saying that the company’s head offices and directors were in Saskatchewan.”
Morrice, a retired lawyer and resident of Victoria, B.C., and Byrne, incorporated three mining companies that had minimal assets, no revenue, and no active mining business.
In May 2009, Morrice received some inquiries about the potential sale of one of the shells, and assisted in the sale of its shares to a third party who was represented by a lawyer from New Jersey.
Morrice then rendered an account for legal services for approximately $100,000 and was paid from the proceeds of sale, according to the BCSC report.
In his settlement, Byrne, a resident of Lumby, B.C., admitted that he helped arrange for nominee directors in Saskatchewan as part of a plan developed with Morrice to circumvent the OTC rule by providing “proof” they were being operated outside of B.C.
As a part of the settlement, Morrice has agreed to resign from any position he holds as a director or officer of any issuer (with limited exceptions). He is also prohibited for 12 years from acting in a management or consultative capacity in connection with the securities market, and engaging in investor relations activities.
Byrne suffered the same fate but received a ban of just four years.
“In order to avoid the application of the Over-the-Counter (OTC) Rule and the filing requirements that came with it, Robert Scott Morrice, a retired lawyer, suggested to Donald Gordon Byrne, his colleague that he find officers and directors for the companies outside of B.C.,” reads the decision. “Morrice also filed disclosure with the SEC saying that the company’s head offices and directors were in Saskatchewan.”
Morrice, a retired lawyer and resident of Victoria, B.C., and Byrne, incorporated three mining companies that had minimal assets, no revenue, and no active mining business.
In May 2009, Morrice received some inquiries about the potential sale of one of the shells, and assisted in the sale of its shares to a third party who was represented by a lawyer from New Jersey.
Morrice then rendered an account for legal services for approximately $100,000 and was paid from the proceeds of sale, according to the BCSC report.
In his settlement, Byrne, a resident of Lumby, B.C., admitted that he helped arrange for nominee directors in Saskatchewan as part of a plan developed with Morrice to circumvent the OTC rule by providing “proof” they were being operated outside of B.C.
As a part of the settlement, Morrice has agreed to resign from any position he holds as a director or officer of any issuer (with limited exceptions). He is also prohibited for 12 years from acting in a management or consultative capacity in connection with the securities market, and engaging in investor relations activities.
Byrne suffered the same fate but received a ban of just four years.
