An Alberta judge has ruled that fraud provisions in the province’s securities laws that allow provincial courts to impose sanctions are constitutional.
Provincial Court of Alberta Judge A.A. Fradsham ruled earlier this week that Securities Act (Alberta) provisions that allow the Provincial Court to impose penal sanctions, including heavy fines and imprisonment, upon those found guilty of fraud and misrepresentation are within the province’s constitutional powers.
Three men facing fraud charges — John Kirk, Benjamin Kirk and Dylan Boyle — challenged the constitutionality of those provisions, arguing that they are in fact criminal law powers, which are the exclusive jurisdiction of the federal government.
Judge Fradsham dismissed the application stating: “The Securities Act is designed to cultivate a fair and efficient capital market in Alberta … The dominant purpose of [these provisions] is to act as a deterrent to investors who are tempted to breach the Securities Act. Deterring would-be offenders serves the Securities Act’s main purpose of ensuring that the securities market is not tainted by actors who are unwilling to trade or sell securities honestly.”