The B.C. Securities Commission (BCSC) has reinstated permanent market prohibitions against a Victoria man for fraudulent activity more than six years ago.
In June 2016, a BCSC panel found Larry Keith Davis committed fraud and ordered permanent market prohibitions against him, along with an order to pay an administrative penalty of $15,000.
The BCSC says the penalties came from incidents in 2011 and 2012 when Davis sold shares of a company that he did not own to an investor and then used the money for personal expenses.
According to the BCSC, Davis lied to an investor in June 2011 that he owned shares of a U.S.-based company and she could purchase through him. The investor paid $4,000 for 40,000 shares, which Davis was found to have deposited into his own account and used for personal expenses.
The BCSC says in April 2012, 30,000 more shares were purchased by the same investor for $3,000.
The investor asked for her money back in April 2013, but Davis refused by saying her i.nvestments were in shares tied to the stock market.
Although she never received the shares, the BCSC says the investor did get her money back in Small Claims Court and the securities commission found Davis liable of fraud for $7,000
Davis appealed the BCSC’s decision, which a court dismissed from the findings of fraud.
The appeals court did allow part of Davis’ appeal and set aside the prohibitions, sending the issue back to the BCSC for reconsideration.
The administrative fine was not impacted by the appeal’s court ruling.
The BCSC says a panel again went over what prohibitions would be appropriate and have reinstated the penalties, which leaves Davis prohibited from:
- becoming or acting as a registrant or promoter;
- acting in a management or consultative capacity in connection with activities in the securities market; and
- engaging in investor relations activities.
Although permanently prohibited from trading or buying securities, Davis is allowed to trade or purchase securities for his own account through a registrant but must give a copy of the BCSC decision to the registrant.