Securities regulators in BC are accusing a man of carrying out an illegal distribution by promoting an investment in film production through Craigslist.
The executive director of the BC Securities Commission has issued a temporary cease trade order against Paul Lester Stiles, who it accuses of the illegal distribution. The BCSC says that Stiles promoted an investment in Velocity Entertainment Inc. that he claimed would provide excessive returns. The allegations have not been proven.
The BCSC reports that in July and August 2011, commission staff discovered a pair of ads on Craigslist, promoting the Velocity investment. A BCSC investigator posing as a potential investor responded to the advertisements, and was told that it was raising funds to produce two feature films.
“Stiles made a number of false statements in promoting the investment, including that it would provide a ‘totally secure’ rate of return of 100% in six months, and provided instructions to transfer funds to his bank account,” the BCSC notes. It says that Stiles was the sole director of Velocity, which was dissolved in 2005, and has never filed a prospectus in BC.
Then in March, BCSC staff discovered another Craigslist ad promoting Velocity. It says a BCSC investigator posed as an investor once again, and responded to the advertisement; and, in the resulting email exchange the BCSC says that he made numerous claims, including that he would guarantee the investment.
BCSC staff say that by promoting the Velocity investment to the undercover investigators, Stiles breached securities laws by making misrepresentations and illegally soliciting securities purchases. A hearing will be held on May 17.