Securities regulator alleges that former broker engaged in illegal insider trading
VANCOUVER, Aug. 7, 2013 /CNW/ - The Executive Director of the British Columbia Securities Commission has issued a notice of hearing alleging that a former broker engaged in illegal insider trading, abused his position as a registrant, and lied to regulators.
The notice alleges that Douglas William Falconer Wood, a B.C. resident and a registered broker until February 2012, used an elaborate scheme of deception, available only to a registrant, to conceal his purchasing and trading of shares of Highland Resources Inc. (now Highland Copper Company Inc.).
BCSC staff maintains that Wood traded Highland shares while he was in a special relationship with Highland, and when he possessed material, undisclosed information about a pending deal between Highland and another company respecting the development of a mineral property.
The notice alleges that Wood used his Panamanian shell company, Doble International S.A., and his relationship with Bank Gutenberg AG to conceal his insider trading. Bank Gutenberg is a Swiss private bank and investment-dealer based in Zurich. Bank Gutenberg was a client of Wood's, having opened a trading account with him in February 2009. In turn, Wood's company, Doble, had a trading account with Bank Gutenberg.
BCSC staff alleges that Wood concealed his insider trading by:
- using his agency account and Bank Gutenberg's account to purchase the Highland shares;
- transferring his shares into Bank Gutenberg's account; and
- directing Bank Gutenberg to allocate his shares to Doble.
During the relevant period, Wood was employed as a broker by Jordan Capital Markets, a registered investment dealer based in Vancouver, B.C. Wood was an employee of Jordan from February 1, 2009 to February 3, 2012. The notice alleges that Wood deceived Jordan and breached Jordan's policies by trading in restricted stocks and failing to inform Jordan about his interest in Doble.
Additionally, staff alleges that Wood breached securities laws by lying during compelled interviews with the BCSC and with the Investment Industry Regulatory Organization of Canada.
These allegations have not been proven. Counsel for the Executive Director will apply to set dates for a hearing into the allegations before a panel of commissioners on September 17, 2013 at 9:00am.
The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the notice of hearing on our website www.bcsc.bc.ca by typing Douglas William Flaconer Wood, Jordan Capital Markets, Highland Resources, Natural Resources Partners L.P., Bank Gutenberg, Doble International S.A., or 2013 BCSECCOM 267 in the search box. Information regarding disciplinary proceedings can be found in the Enforcement section of the BCSC website.
Please visit the Canadian Securities Administrators' Disciplined Persons List for information relating to persons disciplined by provincial securities regulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA).
Learn how to protect yourself and become a more informed investor at www.investright.org
SOURCE British Columbia Securities Commission