The Alberta Securities Commission (ASC) has sanctioned an Alberta woman for making an untrue statement to ASC investigators.
An ASC panel ordered Sherry Hagerty to pay an administrative penalty of $20,000 and $7,500 of the investigation and hearing costs.
The case centred on a Dec. 23, 2011 purchase, by Hagerty’s spouse, of shares in Provident Energy Ltd.
The purchase was made approximately 90 minutes after a meeting at Pembina Pipeline Corp., where both Hagerty and her spouse worked, to which Hagerty had been summoned by Harold Andersen, Pembina’s newly arrived general counsel.
Andersen told Hagerty in the meeting that Pembina was contemplating a potential business combination with Provident, that Hagerty was now an “insider” and that, accordingly, trading prohibitions applied to her and to her spouse.
Pembina and Provident announced on Jan. 16, 2012 that they had reached an agreement concerning the combination, which took effect later.
In the course of an investigative interview by ASC staff, Hagerty gave an account of what happened in the Andersen meeting. Under oath, she told investigators that when Andersen informed her she was now an insider, she told him that the Hagertys “were going to buy Provident this morning”, (a claim she reiterated this in the ASC panel’s merits hearing testimony.)
The ASC panel concluded Hagerty had not, in fact, told Andersen about the Hagertys’ intended purchase of Provident shares.
“We found that Hagerty’s interview statement was materially untrue,” the panel noted in its decision.
In handing down the sanction, the ASC panel said: “The appropriate administrative penalty must be sufficient in quantum to serve as a stern, and memorable, reminder – to Hagerty and to others who might be inclined [to] make untrue statements to Staff investigators – that this type of misconduct comes at a cost better avoided by truthfulness.”