A hearing panel of the British Columbia Securities Commission (BCSC) has handed down stiffer sanctions than regulators asked for against the perpetrators of an investment fraud.
The BCSC imposed a $550,000 penalty on Alexander William Bridges (a.k.a. Alex Blackwell), and ordered almost $500,000 in disgorgement against Bridges and his company, Fraser Valley Hop Farms Inc. (FVHF). The regulator found they illegally distributed securities when they raised $1.85 million from investors, ostensibly to finance the operating expenses of a craft brewing venture, and then defrauded investors by diverting almost $500,000 of investors’ money for purposes other than funding the company.
“We would characterize the fraud committed by FVHF and Bridges as being near to the most serious type of fraud possible in an investment context,” the panel said in its decision.
While the BCSC’s executive director sought a $500,000 penalty for Bridges, the hearing panel ruled a larger penalty was warranted, “considering all of the circumstances of Bridges’ fraud, including his conduct in continuing to raise funds from unsuspecting investors while he was busy spending invested funds on personal uses.”
In imposing the $550,000 fine, the panel stated that the executive director’s recommended penalty “does not place enough emphasis on the scope of the illegal distribution which Bridges led.”
In addition to the financial sanctions, the panel permanently banned Bridges and the company from the capital markets.
The company’s marketing director, Shane Douglas Harder-Toews, whom the BCSC said participated in the illegal distribution but not in the fraud, was also banned for six years and fined $50,000.
Bridges, FVHF and Harder-Toews did not participate in the regulator’s hearing against them.