CALGARY, Feb. 12, 2013 /CNW/ - The Alberta Securities Commission (ASC) has ruled that Calgary-based businessmen Victor George DeLaet and Stanley Kenneth Gitzel breached Alberta securities laws when they made or permitted misleading or untrue statements to be made to investors during the sale of securities in the Focused Life Group of Companies. An ASC panel also found that DeLaet committed fraud against those same investors.
The ASC panel found that Focused Life Group of Companies raised $47 million through the sale of securities over several years. The ASC panel noted that the promotional materials and documents used to sell some of these securities misled investors into believing their investment was secured, with important risks addressed by the business model. The panel found that "the discrepancies between these promises and the reality, if known, would have entirely dissuaded some investors from investing any money in Focused Group securities."
The panel also ruled that DeLaet, as the guiding mind behind this venture, persisted in enticing investors with a sales pitch he knew to be false, perpetrating a fraud. The panel ruled: "We find here a clear, continuing and deliberate deceit, its purpose to obtain money from investors" and that "such fraudulent conduct is unfair to investors and detrimental to the investor confidence on which the capital market depends."
The ASC panel has set dates for ASC staff, DeLaet and Gitzel to provide submissions on what, if any, orders for sanctions and costs the panel ought to make.
The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted to foster a fair and efficient capital market in Alberta and to protect investors. As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.
SOURCE Alberta Securities Commission