Blogger promoted a number of mining, wellness investments
The Alberta Securities Commission (ASC) found that James Domenic Floreani and Jayconomics Inc. breached the Securities Act (Alberta) by engaging in investor relations activities without clearly disclosing that social media posts were made on behalf of four Alberta issuers.
An ASC panel determined that posts promoting Tenet Fintech Group Inc., Gold Mountain Mining Corp., Levitee Labs Inc., and Sekur Private Data Ltd. failed to clearly and conspicuously disclose they were made on behalf of these issuers, as required under section 103.1(2) of the Securities Act (Alberta).
The case now moves into a second phase to determine potential sanctions and cost recovery. Timing for the next steps will be set after submissions from the parties.
James Domenic Floreani operated under the brand “Jayconomics,” posting financial and investment content across platforms including YouTube, X, Patreon, and TikTok.
According to the ASC decision, Floreani built a substantial following, with over 50,000 YouTube subscribers and 2,000 paid Patreon members during the relevant period.
The Globe and Mail reported that Floreani began posting finance content in the summer of 2020 and, despite presenting himself as knowledgeable, did not have formal education in finance beyond an introductory course at Concordia University and online courses through Udemy.
Floreani told the ASC he got the idea to become a finfluencer after seeing others his age posting investment videos.
Floreani promoted companies through videos and posts while receiving payments in cash or shares.
The ASC decision outlined payments that included $787.50 from Tenet, 20,000 restricted shares from Gold Mountain, $85,000 and 100,000 common shares from Levitee, and $6,300 from Sekur.
The Globe and Mail reported that Floreani failed to properly disclose that he received these payments for promoting the companies.
The ASC decision confirmed that while some disclosure was included in YouTube description boxes, it was hidden unless viewers clicked “Show More,” and therefore did not meet the requirement of being clear and conspicuous.
The ASC found that Floreani made recommendations to his audience, with public comments demonstrating viewers acted on those recommendations.
Floreani acknowledged during a deposition on June 15, 2023, that he was unaware disclosure was legally required. However, the ASC stated that ignorance of securities law does not excuse breaches.
The ASC decision confirmed that breaches occurred through the Second Tenet Video, the Gold Mountain Buy Alert, the First Gold Mountain Video, the Levitee Buy Alert, the Levitee Video, the Impugned Levitee X Posts, and the Sekur Video.
The panel found insufficient evidence for breaches related to the Second and Third Gold Mountain Videos, the Gold Mountain Discord Post, and other Gold Mountain X Posts.
Following the findings, The Globe and Mail reported that Floreani’s social media presence changed, with accounts such as his TikTok and YouTube channels no longer accessible.
His Facebook page has limited content, but Jayconomics Inc. maintains a LinkedIn page and a Linktree profile.
Canadian securities regulators have increasingly focused on finfluencers.
Wealth Professional reported a recent survey by the Ontario Securities Commission (OSC) which found that 35 percent of Canadian retail investors made financial decisions based on advice from finfluencers, and that those influenced were 12 times more likely to fall victim to a social-media scam.
Leslie Byberg, executive vice-president of strategic regulation at the OSC, stated that “finfluencers have a clear capacity to affect their audience’s behaviour, and this influence could diminish retail investor well-being – especially if the advice is poor quality.”
The ASC reminds investors that advice and information online may not come from qualified individuals.
Investors are encouraged to verify registration of investment professionals, firms, and online trading platforms.
