Howard Rash Sentenced to Nine Months in Jail for Breaching Ontario Securities Act
TORONTO, Nov. 8, 2013 /CNW/ - Howard Rash was sentenced to nine months in jail yesterday after pleading guilty to one count of fraud and one count of breaching a cease trade order contrary to the Securities Act (Ontario) before the Honourable Justice William A. Gorewich of the Ontario Court of Justice. Rash was also sentenced to two years of probation following completion of his nine month jail term.
Rash admitted that, between September of 2007 and June of 2008, he fraudulently sold units in partnerships of "New Gold LLP" to the public. These sales were made by Rash over the telephone from the offices of a company called Global Energy Group Ltd. in Concord, Ontario. Rash received over $300,000 in fraudulent commissions.
At least $14.75 million (U.S.) of New Gold LLP securities were sold by Rash and others working out of the Global Energy Group offices.
During this period, Rash was subject to a previous cease trade order (CTO) of the OSC made on July 23, 2007. The CTO was put in place against Rash as a result of his illegal involvement in a company called Momentas Corporation and prohibited him permanently from trading in securities.
In his conversations with victims, Rash used a false name, lied about where he was located and provided false information about the assets owned by New Gold. Rash also did not tell victims that he was subject to the CTO, which prohibited him from selling securities in Ontario.
The CTO and other documents related to Rash and Momentas Corporation are available on the OSC website at www.osc.gov.on.ca.
Under section 122 of the Act, the OSC has the authority to lay quasi-criminal charges against individuals or companies in the Ontario Court of Justice for alleged violations of the Act. Quasi-criminal means that a jail term is a possible sanction if a defendant is convicted of a violation of the Act. The OSC pursues cases in court in order to seek sanctions and penalties that send a strong message of deterrence to those who try to exploit investors.
The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices and to foster fair and efficient capital markets and confidence in capital markets. Investors are urged to check the registration of any person or company offering an investment opportunity and to review the OSC's investor materials available at www.osc.gov.on.ca.
SOURCE Ontario Securities Commission